U.S. Chamber of Commerce
Letter on S. 326 The "Patients' Bill of Rights Act"

March 17, 1999

The Honorable Jim Jeffords
Health, Education, Labor and Pensions
United States Senate
Washington, DC 20510

Dear Mr. Chairman:

As the Senate Committee on Health, Education, Labor and Pensions prepares to take up S. 326, the "Patients’ Bill of Rights Act," the U.S. Chamber of Commerce urges you to oppose benefit and plan design mandates that will further increase the cost of health insurance. The U.S. Chamber of Commerce is the world’s largest business federation representing more than three million businesses and organizations of every size, sector and region.

The benefit mandates and plan design requirements included in S. 326 will most certainly increase the cost of health insurance and will disproportionately impact the smallest business owners who lack the ability to manage escalating health care costs. A recent survey of Chamber small business owners found that four out of five of our members experienced premium increases averaging 19 percent this year. Many of these businesses were forced to alter their benefits, often by switching to a lower cost plan or increasing premiums and cost-sharing for employees. Ten percent of small business owners who made changes in response to the premium increases discontinued coverage for their employees. Not surprisingly, a majority of respondents who do not offer health coverage said they would do so if it were more affordable.

The U.S. Chamber opposes government mandates that lock into statute current medical practice and plan design features. Best practices and market innovation in the health care setting evolve continually as practitioners, purchasers, consumers and payers seek higher standards for quality. That many employers and health plans may have voluntarily already adopted a number of the mandates now under consideration should not warrant federal legislation requiring such provisions. The marketplace often moves more quickly in response to consumer demand than can governmental bodies. The mandates under consideration today may well be outmoded in a short matter of time as processes that better serve patients are developed. Unfortunately, these future plan improvements will be hampered in achieving their potential because they must work around the strictures imposed today.

We urge you to reject amendments to S. 326 that would require direct access to specialists and other proposals that loosen the managed care framework. There are many models for providing health benefits that embody managed care principles, with proportionate cost increases as the plans and networks become looser and more open. Yet only 14 percent of the Chamber’s survey respondents with less than 10 employees are able to offer more than one health plan option; just two out of three businesses with more than 100 employees were able to offer a choice of health plans. For many employees of a small business, the difference between having a closed network from which to choose providers and a plan offering more freedom is the likelihood of no coverage at all.

The Chamber also strongly urges you to reject amendments to the legislation that would expand the definition of medically necessary care or expand employer and plan liability in benefit claims disputes. A reasonable system of external reviews by independent specialists would be preferable to drawn out litigation and jury awards for punitive damages that do little to enhance the quality of care provided the patient, but which amply reward trial lawyers. A number of health plans have already voluntarily embraced such a system to ensure that patients benefit from the most current knowledge available with regard to their diagnoses, rather than relying on local custom or common practice that may no longer meet an evolving standard of care. We encourage the committee to leave open the possibility of future improved processes to determine necessary and appropriate coverage and consider appeals.

Many of the amendments that will be offered to S. 326 are intended to resolve perceived inequities in the array of health benefits voluntarily offered today by employers. The U.S. Chamber of Commerce believes strongly in market, not government, solutions to these issues. We ask you to be mindful of the adverse impact good intentions can have in approving measures that will raise costs and threaten continued health coverage in the name of protecting patient rights.


R. Bruce Josten
Executive Vice President
Government Affairs
U.S. Chamber of Commerce