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Managed Care Accountability Now

Don't Let Them Sacrifice Your Health Care for
Insurance Industry Profits

You may have heard its radio spots or read its newspaper ads. The "Health Benefits Coalition," a front group for the insurance industry and Big Business, recently launched a multi-million dollar advertising campaign telling Americans that nothing is wrong with managed care.

But you know better. You've heard the horror stories.

A breast cancer patient whose treatment is delayed until the cancer has spread throughout her body. Parents driving a sick child to a hospital 50 miles from their home in the middle of the night because managed care won't let them go to the hospital 5 minutes away. A patient experiencing chest pain who's unable to see a cardiologist and suffers a fatal heart attack.

Patients want doctors - not managed care - to make their medical decisions.

Several bills pending in both the House of Representatives and Senate (most notably H.R. 1415, the Patient Access to Responsible Care Act (PARCA), and H.R. 3605/S. 1890, the Patients' Bill of Rights) deserve support. They allow injured patients to hold managed care accountable when it negligently delays or denies medical care.

The following is a short overview of the unique but unjust immunity from liability presently enjoyed by managed care:

The problem is ERISA. If a patient receives health care services from a private sector employer, the Employee Retirement Income Security Act (ERISA) dictates the legal remedy available when managed care delays or denies health care. Unfortunately, ERISA provides little or no remedy for injured patients. Under ERISA, state law remedies are preempted.

ERISA remedies are inadequate. ERISA limits insurance companies' liability to patients to the cost of the treatment delayed or denied. Thus, an injured patient may not recover economic losses, such as lost wages or other expenses incurred as a result of the denial of health services, or non-economic losses, such as the loss of fertility, the loss of an eye or a leg, or the loss of a spouse or child. Often, the amount of the treatment denied is nominal, such as the cost of a diagnostic test, and the patient is left virtually without a remedy, even though withholding the treatment may have led to injury or death.

ERISA provides incentives for delaying and denying care. To contain costs, managed care and the insurance industry have developed special review procedures for treatments recommended by physicians. However, these reviews are often performed by accountants and individuals with no medical training. Under ERISA, these review practices can be employed with impunity. Managed care and the insurance industry know that the only sanction for wrongfully denying health services is payment for those very treatments, so they have little or no incentive for curbing the most abusive practices that injure and kill patients.

Proposed legislation would make managed care responsible. Pending legislation (H.R. 1415, 2960 and 3605; S. 644, 1136 and 1890) would allow an injured ERISA patient to bring a lawsuit in state court, where remedies already exist for patients in non-ERISA plans. There would be no need for new laws or added bureaucracy. The availability of existing state remedies would deter managed care abuses and ensure the accountability of insurance companies.

Claims that employers will be sued if the law is changed are false. Some employers, believing the propaganda of the insurance industry lobby, claim that these bills would make them vulnerable to lawsuits. Nonsense! Employers who don't make medical decisions can not be sued. (Legal databases reveal no suits against employers based on the denial of health care benefits.) As long as the employer does not practice medicine or make determinations about the administration of health benefits, the employer will not be involved in litigation.

Employers often help their employees fight mis-managed care. Employers have a stake in ensuring that ERISA health benefits are properly administered to employees -- after all, an ERISA plan by definition has an employer contribution. The employer is often the employee's best advocate in attempting to resolve a dispute with managed care. Employers want their employees to receive the medical treatment they need so they may return to their jobs quickly.

Courts are asking Congress to amend ERISA. Courts have struggled to find a remedy for seriously injured patients covered by ERISA plans, but with mixed success. Many courts have found that the broad language in ERISA completely preempts state law remedies. This was not the intent of Congress in enacting ERISA. Recognizing this legal morass, courts have asked Congress to legislate remedies for these injured patients.

Patients deserve the same protections as members of Congress. Congress exempted itself from the requirements of ERISA, and thus, members of Congress can hold managed care responsible under state law when managed care bureaucrats substitute their judgment for that of a doctor. Why should members of Congress have better remedies than their constituents?

Don't Let Managed Care and the Insurance Industry
Get Away with Bad Medicine!

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