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Copyright 1999 The Houston Chronicle Publishing Company  
The Houston Chronicle

October 14, 1999, Thursday 3 STAR EDITION

SECTION: A; Pg. 33

LENGTH: 827 words

HEADLINE: Congress risks destroying managed care to save it

BYLINE: JERRY J. JASINOWSKI; Jasinowski, based in Washington, D.C., is president of the National Association of Manufacturers, the nation's largest broad-based industry trade group

ANYONE who has ever seen a loved one in a hospital bed knows the importance of high-quality, affordable and accessible health care. The stakes involved, both human and political, are why Washington is debating health-care reform with such intensity.

The recent House passage of anti-managed-care legislation is a case in point. The measure that passed, offered by U.S. Reps. Charlie Norwood, R-Ga., and John Dingell, D-Mich., is popularly called "the Patient's Bill of Rights." But however appealingly named, this bill would only inflict serious wounds on the existing health-care system.

In the name of consumer protection, Congress is poised to embark on an unprecedented regulation of the health-insurance marketplace - to the dangerous consequences of America's employees. At present, American businesses provide health care voluntarily to their employees. No less than 129 million Americans get their health care through employer-based plans.

According to Census Bureau figures released earlier this month, there has been a sharp increase in the number of employers offering medical insurance to their workers, even as the ranks of the uninsured increase due to rising health-care costs. But if the anti-managed-care bill passed by the House is signed into law by the president, the employer-based health-insurance system would be placed at serious risk and the ranks of the uninsured would actually grow.

Employers are understandably concerned with provisions in the pending legislation that would make them liable for personal injury and wrongful-death lawsuits. Such liability would be a field day for trial lawyers eager to sue companies for the real or imagined medical-insurance problems of ordinary people.

Employers, hit hard by the costs of litigation, would be forced to pay a significantly higher rate for the insurance they provide. These costs would be passed on to the consumer and would prevent increases in employee compensation. In some cases, companies would simply stop providing health insurance to their workers.

Of course, the anti-managed-care bills claim to shield employers from health-care liability. But they expressly would subject employers to liability lawsuits if the employer exercises any "discretionary authority" over the health plan, which is the very essence of the fiduciary responsibility the federal Employee Retirement Income Security Act places on all private health-care plans. No employer would be eligible for the exemption.

In addition, these plans would dramatically increase the role of government in the health-care system, something rejected by the American people several years ago when the president's proposed government takeover of our medical system collapsed like a deflated zeppelin.

The Norwood-Dingell plan contains hundreds of new government mandates. It would regulate the private medical-care system to an unprecedented degree.

Managed care is working much better than its opponents like to admit. According to the Labor Department, physicians acknowledge that existing plans approve coverage of 97 percent of recommended treatments. And virtually every survey indicates a 90 percent satisfaction rate when people are asked about the quality of care they receive.

The Congressional Budget Office estimates that the Norwood-Dingell plan would drive up premium costs by more than 6 percent annually. Combine this with the costs of lawsuits and new regulations, and many private insurers - namely, America's employers - will be priced out of offering medical insurance to their workers, thereby increasing the number of uninsured.

Kentucky offers a disturbing lesson to those who wish to impose sweeping changes to our health-care system. In 1996, the Kentucky Legislature passed sweeping, regulation-heavy "reform" legislation similar to that proposed for the country as a whole by President Clinton in 1994. There were then 45 insurance companies writing medical insurance policies for private citizens in the Bluegrass State.

Within months, only two companies remained. Why? Costs soared as premiums rose and litigation flooded the courts. The Kentucky Legislature finally repealed or modified its well-intended "reforms" so that ordinary Kentuckians could again have access to health care - although, to date, only one additional health-insurance carrier has resumed doing business in the state.

No one claims that managed care is perfect, which is why more modest reforms like those passed earlier this year in the Senate are worth considering. It is my hope that when House and Senate negotiators meet to discuss their very different legislation, legislation without the damaging provisions I've noted will be adopted.

But the great majority of the time, managed care works. In the name of compassion, opponents of managed care want to destroy the existing system. And in this instance, especially, good intentions are more than inadequate. They could well be deadly.

GRAPHIC: Drawing

TYPE: Editorial Opinion

LOAD-DATE: October 28, 1999

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