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