- The Washington Times - Monday, September 10, 2001

One of the critical issues Congress will take up this fall will be the so-called patients' bill of rights. There's a great deal to dislike in both the House and Senate versions, which were passed before Congress left town for its August recess. Both would expand bureaucratic control over health care and empower lawyers to file more lawsuits against U.S. businesses. The Senate measure, sponsored by Sens. Edward Kennedy, John Edwards and John McCain, is particularly bad. It would do virtually nothing to enable the 43 million Americans currently without health insurance to obtain it at an affordable price. In fact, by making it easier to sue employers over actions taken by health-maintenance organizations, the legislation could well exacerbate the problem, as small entrepreneurs faced with the prospect of being bankrupted by lawsuits decide that it is too much of a hassle to provide insurance for their workers.
To be sure, many of the same flaws are also contained in the House version of the bill. But the House bill also contains several necessary free market improvements, which could make it easier for small businesses to provide health insurance for their workers. (According to a study by the Employee Benefits Research Institute, approximately 60 percent of America's 43 million uninsured live in a household headed by employees or owners of small businesses.) An amendment, introduced by Ways and Means Committee Chairman Bill Thomas and approved by the House 236-194 on Aug. 2, would remove the ill-considered caps on the number of Americans who can get medical savings accounts and allow companies to set up what are known as association health plans (AHPs).
AHPs enable small businesses through their membership in trade groups and professional associations to join together across state lines to purchase health insurance for their employees and their families at lower group rates.
Under the 1974 Employee Retirement and Income Security Act, big labor unions and large companies that have operations in many states can already offer health insurance under a uniform federal law without having to comply with the myriad rules, regulations and benefit mandates that are in effect in all 50 states. Under the Thomas amendment, this opportunity would be accorded to any small business, regardless of location. This would, for example, enable a small business, such as a restaurant, to enroll its employees in a health-insurance plan run by an organization such as the U.S. Chamber of Commerce or the National Restaurant Association. These organizations would essentially function in a manner similar to the human resources department of a large company.
But state insurance commissioners, the National Governors' Association and the National Conference of State Legislatures doggedly protecting their turf have fought against essential reforms such as AHPs. In doing so, the insurance commissioners have found reliable allies: Minority Leader Dick Gephardt, the rest of the House Democratic leadership and the overwhelming majority of the House Democratic Caucus. Just 18 Democrats supported the Thomas amendment; 191 Democrats voted "nay."
Now, to be fair, the Democrats' obstructionism wasn't motivated solely by a desire to carry water for the insurance regulators by opposing AHPs. They were no less incensed by the fact that the Thomas amendment also ended the anachronistic limits placed on the number of Americans who can obtain medical savings accounts.
But, even if conferees leave the Thomas amendment intact, whatever version of the patients' bill of rights that emerges is almost certain to be a regulatory disaster. President Bush would be well-served to veto that bill, and press for the enactment of medical savings accounts and association health plans as free-standing measures.

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