H.R. 2990 CONFERENCE

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THURSDAY, MARCH 2, 2000

U.S. Senate,
Committee on Health, Education, Labor, and Pensions,
and the U.S. House of Representatives,
Washington, D.C.

The joint conference convened at 3:26 p.m., in Room HC-5, U.S. Capitol, under the chairmanship of Hon. Don Nickles.

Present: Senators Nickles, Jeffords, Gramm, Gregg, Frist, Enzi, Hutchinson, Kennedy, Harkin, Mikulski, and Rockefeller; Representatives Bliley, Bilirakis, Shadegg, Archer, Thomas, Johnson, McCrery, Boehner, Talent, Fletcher, Goss, Dingell, Pallone, Andrews, Waxman, and Berry.

Mr. *Bliley.* If I could have everyone's attention, please, it is my pleasure to kick off this important conference by nominating Senator Don Nickles to be the conference chairman. Don is one of the Senate's most active leaders in health care reform issues. Last year, he led the Senate Republican Task Force on Health Care Quality, which wrote and shepherded through the Patients' Bill of Right-Plus Act. He has a background in small business which I think will provide a very important perspective for this conference.

I therefore am pleased to nominate Senator Nickles as our conference chairman and so move his nomination among the House conferees.

Without objection, it is adopted.

OPENING STATEMENT OF CHAIRMAN NICKLES

Chairman *Nickles.* I like the way you run a meeting, Mr. Chairman. Thank you very much.

I will make a few comments and then call on a few of our colleagues to make some opening remarks. But first, let me outline our agenda for all of our conferees and for all the staffs involved, and perhaps extend my condolences and sympathies--we are going to work real hard this month; we are going to work very, very hard. And I want to thank all the staffs, including Senator Kennedy's staff and Congressman Dingell's staff, as well as Chairman Bliley's and Chairman Archer's and, frankly, all the members--Chairman Jeffords and his staff. They have done a lot of work.

When I talked with Senator Kennedy a couple of weeks ago about setting up the initial meeting, but then postponed it at his request, we said let us see if we can get some work done in the interim and ask our staffs to see if they cannot come up with some agreements on some like provisions. They have done a lot of work, and they have made some good progress, and I want to compliment them.

I want to urge my colleagues to listen to me just for a second as far as the agenda is concerned, because it is going to be a very aggressive agenda. We hope to complete this conference by the end of this month. That is much easier said than done. It will take a lot of work and a lot of cooperation and, frankly, some bipartisan cooperation, which I am certainly willing to try to extend, and I hope all members on all sides will be willing to do so.

It is my hope that we can work aggressively to look at some of the items that are in common, and I will touch on those momentarily; try to see if we cannot come to conclusion and agreement on as many items as we can on patient protections; I think we have one or two now and are close to having some others agreed to by staff.

We have some more contentious issues that we will have to wrestle with as well, and again, it is my hope and belief that we can work through these and come up with a positive bill.

But my objective is to complete it by the end of this month. You might ask, why so aggressive. I think we have a much better chance of passing good legislation, legislation that is not so partisan and not so political, maybe keeping it out of the political arena to some extent, if we work sooner rather than later. There has already been a lot of work done on both sides, House and Senate, Democrats and Republicans, on these proposals, so I think we can do a better job if we concentrate and try to complete it.

I would also say that it would be quite easy for people to say let us just make this conference go all year. That is not my objective. My objective is to work very aggressively, to push ourselves and push our staffs and see if we cannot come up with a positive bill.

What should that bill do? Two or three things, in my opinion. One, the bill should do no harm. We have a quality health care system in our country today, so we should not do any harm; we should not make it worse. We should not increase costs to where we make health care more unaffordable. We should not increase the number of uninsured. We should increase patient protections, and we should expand protections for those people who do not have them. We should come to some agreements, I think, on many provisions, and I will just touch on some.

On emergency room access, our staffs are very close to having an agreement, and I compliment them for that. On access to pediatric care, I think we are very close to a consensus, or possibly even do have a consensus. On direct access to obstetrical and gynecological care, we are very close to being there. On point-of-service, timely access to specialists, continuity of care, access to prescription drugs, clinical trials--all of these involve some differences, but there are also some commonalities, and maybe we can work those out and hopefully complete them. We have some differences pertaining to scope--should we duplicate plans' regulations that currently and have always been regulated by States? There is a difference between the House bill and the Senate bill. What kinds of remedies? Both bills have internal and external appeals. Should we have additional remedies beyond that, including liability changes? If so, what other liability changes should be enacted? Those are changes, or differences between the two bills, and are going to be difficult to do. But again, there are other things that are in common, like gag rules. I cannot help but think we can come to a common agreement on several of these provisions.

Also, I want to compliment our colleagues in the House for several of the access provisions that they passed. Chairman Archer, my compliments to you and your staff, and frankly to the House, for passing things that will help make health care more affordable. You have done that for self-employed; you have put in an above-the-line deduction for individuals who get no contributions from employers--maybe they are unemployed, or maybe they have an employer who contributes nothing. I compliment you for that. Both bills have medical savings account provisions which should help improve access.

So again, my compliments to our colleagues in the House, and my pledge to my friends, both Democrat and Republican, who have agreed with us and maybe disagreed with us. I will work energetically with you over the next month to try to complete this bill.

Our objective is to complete the bill and have it pass both Houses of Congress by Easter. I know that that is a big order. If you look through all the changes and proposals that we have, you will realize how difficult it is.

Also, on the agenda, just so you will have an idea, I hope that as far as patient protections, we can work through those and come to an agreement, and then move into the bigger issues--the bigger issues being scope, medical liability, the internal and external appeal process--with access maybe coming a little bit later.

I have complimented our staffs for the work they have done on the patient protection provisions already. I want to encourage them to continue working, and for each joint session that we have with the Conference, I would very much like us to begin by saying we have come to closure and agreement on the following things, and to explain those, so that we can say, okay, we have completed that, and now let us move on to some of the other issues, and frankly, some of the issues that will possibly be more difficult and slightly more contentious.

Next, I will call on my colleague Chairman Bliley.

OPENING STATEMENT OF MR. BLILEY

Mr. *Bliley.* Thank you, Mr. Chairman.

I want to thank you for convening this conference today. As chairman of the House Commerce Committee, I have worked with my friend John Dingell and other Members on both sides of the aisle to do all we can to ensure that all Americans have access to the greatest health care system in the world. I believe that among the issues that we deal with in Congress, first and foremost, we must do all we can to ensure the health and safety of the American people.

Managed care is the response of the health care industry to double-digit annual increases in health care costs. By managing care, employers were able to better manage their costs, and we saw a dramatic decrease in health care inflation.

We are here today because many argue that the pendulum has swung too far and that the ability of providers to deliver high-quality care is being compromised in order to save money. It is now our job to come together to ensure the proper balance of keeping insurance affordable and ensuring we maintain the high standards of quality health care.

The House-passed bill endeavors to assure a number of patient "rights." Among those are the right of access to emergency room care, to specialists, to the ob-gyn provider of choice, and to the doctor of choice through a point-of-service option.

It is important to realize that these protections apply only if you have health insurance, but if you are one of the 44 million Americans today who cannot afford health insurance, these rights become meaningless.

While America can be proud that it provides the best and highest-quality health care in the world, it is disturbing to see, year after year, the number of uninsured Americans continue to increase. Despite the booming economy we are enjoying, the number of uninsured in this country continues to grow. As we consider reforms to the private health insurance market, we must be mindful of the impact such changes will ave on access to health insurance for all Americans. I hope the conferees are always mindful of this as we move forward with our work on this conference committee.

Last year, the House passed a health reform bill which included a number of provisions which I believe will actually increase access to affordable health insurance. One piece that I am proud to have offered is the proposal to create HealthMarts. What many Americans are missing today is a place to shop for affordable health care coverage that meets their families' needs. Members need not look any further than their own health coverage in the Federal Employees' Health Benefits Plan to understand the value that individual choice brings to themselves and their families.

HealthMarts are modeled after the FEHBP. They are designed to give employees of small employers a true marketplace to shop for health insurance and make choices irrespective of where they work.

As vice chair of this conference, I intend to work with all conferees to draw from the best of both bills before this committee. I am hopeful we can present such a result to the President and that he will sign it into law. I look forward to working with my colleagues in the conference in finding the right solution to address these critical health care issues of utmost concern to the American people.

Thank you, Mr. Chairman.

Chairman *Nickles.* Chairman Bliley, thank you very much. I do look forward to working with you and appreciate the fact that you are willing to work with us as well.

To all of our friends and colleagues in the House, I will tell you what I told Chairman Bliley. It is not my intention to say we think the Senate bill is superior in every way and always be debating in terms of House versus Senate. I agree with Chairman Bliley that we should try to pick out the very best from both and seek to fashion and pass the best package that we can, consistent with trying to keep costs affordable and not increasing the number of uninsured.

Next, I call on my colleague, the chairman of the HELP Committee, Chairman Jeffords.

OPENING STATEMENT OF SENATOR JEFFORDS

Senator *Jeffords.* Thank you, Mr. Chairman.

I share Chairman Nickles' optimism and believe that we can and will reach agreement. Of all the decisions that we will have to make over the next few weeks, the most important one will be whether we want to spend our time worrying about politics or about patients. It will come as no great surprise that I hope we choose to put patients first and to work through our differences to find an approach that provides the strongest patient protections possible. At the same time, we must not drive up the price that patients pay for health care, either directly or indirectly, through their employers.

If anyone has been lulled to sleep by the relatively tame inflation in health care premiums over the last few years, I am afraid Vermont provides a loud wake-up call. Vermont's employers are struggling with premium increases of 20 to 30 percent, with one school district reporting a 50 percent increase in its health insurance policy.

Faced with these price spikes and the departure of one of the State's few major carriers, our Governor and leaders in the State legislature have agreed to a moratorium on the passage of additional consumer protections.

Congress cannot work at cross-purposes with our States, who best understand the needs of local health care markets. This is not an issue of States' rights; it is an issue of who is best situated to determine what is right for our States.

Nor can we afford to work at cross-purposes with our voluntary, employment-based system. A recent survey found that over one-third of employers said they would stop offering health insurance coverage if Congress exposes them to malpractice lawsuits. Since more than 128 million Americans receive their health insurance on the job, even a small change in employer behavior could cause millions of Americans to lose their health insurance.

Despite differing approaches on some issues, the Senate- and House-passed versions of the Patients' Bill of Rights have much in common. They share several provisions that provide new patient protections. Each version provides for information to assist consumers in navigating the health care system, and both bills contain common provisions for increasing access. Most importantly, the bills provide for an internal and external independent review process with strong new remedies when the external review process fails.

I believe it is within these common provisions that we will ultimately be able to find the necessary compromise for a successful conference agreement.

Over the last 2 weeks, our health staffs have been meeting on a bipartisan, bicameral basis in order to better understand the two bills and to start developing recommendations on a number of key provisions. I understand that these meetings have been very productive; however, I do not underestimate the difficulty of our task, especially in three critical areas--the external appeal process; the appropriate remedies when that process fails; and sorting out the proper State and Federal roles.

Fortunately, I believe we can provide the key protections that consumers want, at a minimal cost and without disruption of coverage, if we apply these protections responsibly and where they are needed without adding significant new costs, increasing litigation, and micro-managing health plans. Our goal must be to give Americans the protections they want and need in a package that they can afford and that we can enact.

This is why I hope we will be successful in our efforts to fashion a true Patients' Bill of Rights that can be passed and signed into law by the President.

Thank you, Mr. Chairman.

Chairman *Nickles.* Chairman Jeffords, thank you very much.

Next, I will call upon my friend and colleague from the House, Congressman Dingell.

OPENING STATEMENT OF MR. DINGELL

Mr. *Dingell.* Mr. Chairman, congratulations on your selection to lead this conference. You have a difficult task, but I am satisfied that you will work very hard to do it in a proper and gracious fashion. You have my best wishes and my pledge to cooperate in achieving a good bipartisan bill.

As you will recall, you were gracious enough to come over and visit me in the House at which time you pledged to work in a bipartisan manner to get a Patients' Bill of Rights enacted into law. I am delighted about that, and I very much appreciate both the courtesy that you showed in coming over to the House and also the assurance which you so graciously gave us.

It would have been impossible, I would note, for us to have passed this legislation on managed care reform without the fact that it was a strongly bipartisan bill, and without the support of two distinguished members of the medical profession, Dr. Norwood and Dr. Ganske, who worked very, very hard to craft, first of all, a bipartisan bill, and second, to provide leadership to Members on both sides of the aisle in the enactment of that legislation. So I want to pay tribute to both of those fine gentlemen and to some 60 other decent and energetic Republican Members who were motivated to work together with their Democratic colleagues to achieve enactment of a truly bipartisan piece of legislation with minimal difficulties and with great enthusiasm and effort.

I only regret that the House leadership did not honor these bipartisan sentiments expressed by so many Members of the House by appointing House conferees who, in the tradition of the House and in accordance with the Rules, fairly and faithfully represent the will of that body. I particularly express my regret that Drs. Ganske and Norwood are not here with us today.

I would like to apologize to you, Mr. Chairman, and to the other conferees because of the number of my House colleagues who could not be with us today. Many of them took the opportunity to return home when the House abruptly concluded its business yesterday. The House does keep, as you know, an odd schedule these days, and this may be one of the items that we will have to address after the November elections.

In any event, 5 months have now elapsed since the House passed the bill that is in conference today. Some of us, Dr. Norwood and myself among them, have been working on this issue for years, as have a number of others of my colleagues, some of whom are present in this room. We share the belief that if you pay good money for health insurance, you should get good health care when you have need of it. The only thing worse than having no insurance is paying for insurance and getting nothing in return. Regrettably, that situation obtains for many of our people, and we find that, regrettably, the health insurance organizations--HMOs, most specifically--are protected against Federal lawsuits. It is interesting to note that they and foreign diplomats, unique and alone amongst others in our society, are absolutely sheltered from lawsuit for wrongdoing.

There are wide differences between the House and Senate bills. I remain hopeful that this conference will be productive, and I look forward to working with you and hope that I will be able to assist you in achieving that end and to accomplish what both of us want, and that is a meaningful Patients' Bill of Rights legislation which can be sent to the President to be signed into law in a bipartisan signing ceremony. To do that will require us to address and to solve satisfactorily three critical issues--first, how many people are going to be covered by this legislation. Is every American going to have the same rights in dealing with his or her insurance company, or do we propose to create several--one, two, or possibly three--different classes of citizens who will have the right to be protected or have the right to sue if they are wrong? That is a very, very important question--the difference between the Senate bill and the House bill is the difference between some 40 million and some 160 million. I find myself hopeful that we will go with the larger number.

Second, who will decide on what treatment you get and why? Will the decision rest with you and your medical professional, or will it be in the hands of an HMO bureaucrat? When your doctor and your HMO disagree, will you be able to appeal the decision to an independent internal review and an independent external review? And what will that review have in the way of final say? Will it be based on medical knowledge, or will it be defined by some narrower definition of medical necessity put forward by the HMO?

I will just tell you a little story that I think merits telling. A good friend of mine who is a distinguished medical practitioner in the 16th District called me and said, "Dingell, I have just been fired by the HMO for which I work."

I say, "I am sorry to hear that, Doc. Why?"

He said, "As you know, I was an appeals officer for one of the major HMOs in this area."

I said, "Well, why did they fire you?"

He said, "They said I was making medical decisions and not insurance decisions."

That is a serious matter, and I believe it defines all of the questions that are concerning us here today with regard to medical necessity.

Third, as one of my Jesuit teachers taught me back in school, a right without a remedy is no right at all. What happens when an HMO refuses to follow the recommendation of an external review body and causes harm or death to the patient? If an HMO is making medical decisions by denying treatment, isn't it proper that it should be held accountable in the same way we make doctors responsible for their actions?

The staff has already begun to work on a small number of other issues raised by the conference, and I am pleased that some progress has been made here. I commend you, Mr. Chairman, for that way that you have seen to it that the staff on the Senate side has been working with the staff on the House side.

It is my view that the conference can be concluded quickly, but it can only be concluded quickly if we use the bipartisan House bill, the only bipartisan bill before us, as the basis for our discussion. That, of course, is the recommendation only of a minority Member of the House. The ultimate judgment on how we proceed and our success will fall into your capable hands, and you have my good wishes, Mr. Chairman.

Thank you.

Chairman *Nickles.* Congressman Dingell, thank you very much.

Next, I will call upon my friend and colleague Senator Kennedy.

OPENING STATEMENT OF SENATOR KENNEDY

Senator *Kennedy.* Thank you, Mr. Chairman, and thank you for your earlier consideration in terms of the scheduling when I was unfortunately detained.

I want to express strong support for the outline that you have given, Mr. Chairman, in regard to the way of proceeding. I am certainly hopeful that we can work with you to try to achieve a worthy outcome for legislation which is so important to the American people.

One little addendum that I might add is that as agreements are made, if they can work it out in such a way as the language is actually drafted in a bipartisan way, I think that that always helps to shorten the process as well.

I think the one overriding issue--and others have spoken about it, Mr. Chairman--is really whether we are ultimately going to have the important medical decisions which affect families in this country made by the doctors and by the families and the medical professionals, or

whether they will be made by a bureaucrat. That is really at the heart of it. There are other provisions which are relevant to that and to making that basic and fundamental right a reality, but that is really at the heart of this whole situation.

As President Clinton said today--and I believe it to be so, and I think most of us here today would understand it to be so--there are probably few public policy issues that we will face in this Congress that will have as broad and as wide appeal and support as an effective Patients' Bill of Rights legislation. It shows itself all across this Nation. It shows itself in the polls. It has support among Republicans and Democrats alike.

The place where it has reached the most contentiousness has really been in the Congress, and I think all of us, as we meet on the opening day of this conference process, aiming toward conclusion in a way that is worthy of this conference, understand that. So it puts a particular challenge on all of us.

I personally believe, Mr. Chairman, that the legislation which passed the House of Representatives, the Norwood-Dingell bill, addresses that challenge. We had a vigorous debate in the Senate on our legislation, and a number of roll calls were taken, but I personally believe that the outcome, which was bipartisan in nature and which resulted in the House action, really answers this central challenge which exists in all parts of this country today.

We start off, really, if we look over the numbers on it, with 47 Members of the Senate, actually, in support of that particular program. So we have legislation that has actually passed the House of Representatives with bipartisan support, and we have some bipartisan support in the Senate with 47 announced Members, and my own feeling is that it would be 50 or even more if we were actually voting on it this afternoon.

So I would expect we would measure anything that comes out of this committee as the benchmark against what has really been a very solid bipartisan effort which came through the House. It is an effective answer and has the support of 300 health organizations, the medical professions, every aspect of the health community, as well as the support of those who study this issue representing women, representing children, representing workers. So it seems to me that this really sets a standard for us by which to be measured.

I welcome the opportunity to see what adjustments and changes and compromises ought to be made, but it does seem to me at the end of the day that whatever we pass is going to be the standard and the benchmark that will really be the actions that were taken by the House.

I think the American people deserve the important protections that were included there, and I look forward to working with our colleagues to see if we cannot work through this whole process and come out with a product that is worthy of our efforts.

I thank the chair.

Chairman *Nickles.* Senator Kennedy, thank you very much.

Let me just make a couple of concluding comments. One, I think it is important for us now--somebody said, well, let us work off the House bill or work off the Senate bill--my statement to Chairman Dingell was let us try to take the best of both. If you look at the provision that basically, we are getting close to agreement on, on ER, we are taking a little bit of both, and we are doing the same thing on pediatrics. There is some good work that staffs and Members--and I might mention that on the Senate side, Members and staffs wrote this bill. It was not written by any special interest group. It was written by Members and staffs, and we put a lot of time into it.

I am shocked to hear Senator Kennedy say he wants to work off the House bill, knowing that he is a Senator and should be representing the Senate side, but that is all right.

Senator *Kennedy.* Well, you notice the initial proposal was identical to the House provisions that were supported effectively by 47 Members. So our proposal that has the 47 is effectively the same as the House bill.

Chairman *Nickles.* My point is that I said we would try to take the best of both. We could say, okay, here is the Senate bill, and here is the House bill, and House, you submit a package, and we the Senate will submit a package, and we could end up with no conference. It would be very, very easy--I would imagine everyone in here has been on conferences before. With the differences starting out as significant as they are, particularly on scope and liability, it would be very easy to say this is not going to happen.

I want to make an effort to make it happen. When I heard Senator Kennedy say, hey, this is really, ultimately, finally, about having physicians making the decisions, I am willing to say we can work that out. I absolutely think we can. I think if you look at internal and external appeals--and I have looked at the House-passed package, and I have looked at ours--I think it is doable. Maybe I am too optimistic, but I want to give it a try.

Congressman Dingell, I told you I would work with you. So my attempt and I think our expectation is let us work as hard as we can and as aggressively as we can to see how many things in common we can work out and we can agree on, so that the next meeting we hold, our staffs will say we have come to a conclusion on this, and maybe we have some disagreements where--and that is fine; we will leave that out--and we will continue working.

I would also like to say let us try to--we have plenty of time before the elections--let us try to leave a lot of the politics aside and go to policy, and let us see if we cannot come up with a good, positive package. This will impact every, single health plan in America. So let us try to do something really good--and then, if we are not able to get it done, we have tried. Let us give it a good effort.

So I am going to be presumptive and thank all Members for their cooperation. It will be my anticipation that we will have another conference next Thursday, and I hope and expect at that time to be able to say we have come to some conclusions.

We are asking your staffs to be very engaged with our staffs to work out some of the things on patient protections, and then, if people have different ideas--as Senator Kennedy mentioned, we want to have physicians making some of these decisions, and that triggers some possibilities with me--so I cannot help but think that maybe we can make some progress. We will try, and again, our objective is to conclude this thing by the end of this month. I look forward to working with all Members.

Mr. *Thomas.* Mr. Chairman.

Chairman *Nickles.* Yes, Congressman Thomas.

Mr. *Thomas.* I ask unanimous consent that the written statement of the Chairman of the Ways and Means Committee be placed in the record and any other written statements.

Chairman *Nickles.* Certainly. Any statements that Members wish to have included in the record will be included at this point.

[The statement of Mr. Dingell follows:]

/ COMMITTEE INSERT

1-20 [The statements of Messrs. Enzi, Frist, Hutchinson, Jeffords, Kennedy, Mikulski, Rockefeller, Andrews, Archer, Berry, Bilirakis, Bliley, Clay, Fletcher, Goss, Pallone, Rangel, Shadegg, Stark, and Talent follow:]

Chairman *Nickles.* I appreciate that, and with that, we will adjourn the conference.

Thank you.

[Whereupon, at 3:56 p.m., the conference was adjourned.]