Judd Gregg

Mr. GREGG

Mr. GREGG. Reserving the right to object, I will take 30 seconds off our time to make my reservation. Regarding the unanimous consent request, as he knows, we said we are willing to talk about this. Due to the timing, we are not going to be able to resolve it. I would be willing to suggest that we take out the first part of that unanimous consent request and go with the language which at least cleans this amendment up relative to blue slip language, so that the unanimous consent would instead read as follows: That when S. 1052 is read the third time, it be laid aside and the Senate immediately proceed to the consideration of Calendar No. 69, H.R. 10, and that all after the enacting clause be stricken, and the text of S. 1052, as amended, be substituted in lieu thereof, and the bill then be read the third time, and the Senate proceed to a vote on final passage of the bill. The practical effect of that would be that at least as to this amendment, until we can clear the other issues, we would have avoided the blue slip matter. Would the Senator accept that as an amendment to the request?

Mr. GREGG. Then I will simply object. I object.

Mr. GREGG. Reserving the right to object----

Mr. GREGG. I believe there is a unanimous consent to which this side is agreeable which has been circulated from your side, and we are willing to proceed with that at this time.

Mr. GREGG. Will the Senator yield?

Mr. GREGG. I do believe that problem can be worked out. Actually, the language for working it out is in this unanimous consent request. It is just that the unanimous consent request goes significantly further than that. That is where I think we have to sit down and see if we can't reach some accommodation.

Mr. GREGG. If the Senator will yield on that point.

Mr. GREGG. The point I was concerned about was, there are parts of this unanimous consent with which I could agree, but the two points the Senator from Texas and the Senator from Oklahoma have made are equally of concern to me. Maybe there is a way to work this out, but in its present form I have a serious reservation about it.

Mr. GREGG. Reserving the right to object.

Mr. GREGG. If the Senator will yield, I yield back the remainder of my time.

Mr. GREGG. I reserve that time.

Mr. GREGG. Mr. President, I will continue the discussion we have been having over the last few days about some of the concerns relative to the McCain bill in the area of liability, especially as it relates to employers ending up being sued. It is important to put it in context. We continue to hear a lot of anecdotal stories which are compelling about people who have been maltreated by their HMOs or by their insurers. It is important to remember that there has not yet been a story related on the floor, as compelling as they are, that would not have been addressed not only by the McCain bill but by the Breaux- Frist-Jeffords bill or by the Nickles bill which was on the floor last year. So those are not the issue. We all intend to introduce a bill that makes sure that people have adequate recourse when they are treated improperly by HMOs or by their health insurer. The problem we have with the McCain bill is that it is essentially a gross expansion of the ability to sue. It is a bill that was designed for the purpose of allowing lawsuits against employers at a rate which has never been conceived of under present law or in other bills being considered. The bill creates all sorts of new causes of action and new opportunities for these lawsuits. As a result of the expansion and explosion of lawsuits, you are going to see employers dropping insurance and people being left without insurance. So instead of being a Patients' Bill of Rights, it is going to be a bill that creates employees who have no insurance. It would be just the opposite result that we should be looking toward. In fact, CBO has scored the McCain bill as being a bill that will cost 1.3 million Americans their insurance, because it will be dropped by their employers. The reason is simple: The bill just was written for lawyers by lawyers and of lawyers--trial lawyers. For example, it allows forum shopping, one of the age-old games that is played in the legal community. I used to be a lawyer and we used to forum shop when I was doing trial work. It allows forum shopping, which is something that should not be allowed and is not allowed today because ERISA controls this area, and the Federal courts are responsible. But under this bill you can go to Federal court or State court, depending on where you think you are going to get the most recovery. Some States have no compensation caps, no liability caps, and punitive damages are available in State courts; sometimes you may pick the State court and other times the Federal court, depending on the judge and the type of jury you expect to get. Forum shopping allows the employer, as I have talked about, to be sued for minor offenses that are administrative. Literally hundreds of new causes of actions are created under this bill--hundreds--where the employer can be sued in private causes of action. It allows employers to be sued for unlimited compensatory damages, and for punitive damages, which is something that cannot occur today under Federal law. It has a new title--``special assessments,'' I think, is the term in Federal court--with a $5 million cap. Today, you can't sue for punitive damages. But that is really irrelevant to the cap because you can get around the cap by going to State court with the forum shopping opportunities. So punitive damages are there. Punitive damages is one of the things that worries employers the most. Most employers accept the risk of punitive damages if it is for a product they produce. If I am an employer and I am making desktops, I accept the risk that I make a good desk top and I sell it. If something goes wrong with that, I accept the risk that I should be subject to liability. But what we are talking about here is making the employer liable for medical treatment that his or her employee gets because the employer presented his or her employee, as part of employment, health insurance. The employer doesn't have any control over a doctor that acts poorly or an HMO that acts irresponsibly, but under this bill an employer can be subject to punitive liability. That is something most employers find totally unacceptable--and they should. That is why you will have employers walking away from the insurance concepts and from giving insurance if this bill passes. That is why you will have more people uninsured. It permits a lawsuit right out of the box. You do not have to go through the administrative appeals process. Now, the great strength of both the Frist bill and the Nickles bill is that they try to avoid lawsuits while still giving the person who has been injured redress. The way they do that is through an administrative appeals process that has independent doctors, independent reviewers, people who have nothing to do with the HMO, nothing to do with the employer, reviewing the situation when you think you have been maltreated or poorly treated by your HMO or your doctor, and they are totally independent and you get a fair and honest evaluation. That is called the external appeals process. That is an important reform and an important right for patients--a huge right and an important right for patients. But what the McCain bill does is say you don't have to go through that stuff. You can go directly to court and bypass the external appeals process. This is a huge loophole for the purpose of creating more lawsuits. Any good lawyer is going to be able to skip the external appeals process and go directly to court and sue not only the HMO and the doctor--potentially, but also sue the employer. Under this bill, the lawyer would be committing malpractice if they didn't sue the employer. So that is another area where you have this huge expansion of lawsuits. Not only that, but you undermine what is true reform. True reform is destroyed by that proposal. Another area where the plaintiff's trial lawyer language and fingerprints are all over this bill is that there basically is no time limit for when you can bring the action. If, after the 180-day appeals process has expired, you decide you have a cause of injury, you can claim a cause of injury and you toll the statute of limitations. You could be 10 years out under this bill and still energize an action against the HMO, the insurance company, and the employer. It is basically open-ended. It is lawsuits to infinity. In addition, of course, it allows for simultaneous lawsuits. Not only do you have forum shopping, you can sue in all the forums, all the time, altogether. You might have some employer who is running a small restaurant, with maybe 30, 40 employees, or who has a small startup business, with maybe 20 or 30 employees, or a few gas stations that he operates, or a repair station with 20, 30, 50 employees; they can suddenly find themselves defending a case on literally hundreds of different causes of action in two different forums within one State, in the Federal court and the State court. This could be so multiplied that they would have to hire 16 law firms to defend themselves. And the cost is extraordinary. The average cost of defending a malpractice issue is $77,000. That is more than the profits of many small businesses in America today. And they all can be drawn into these lawsuits. It won't be the insurance companies they will have to defend--they will, too, but the employer will also have to defend under this bill. So you can have consecutive and simultaneous claims both in State and Federal court. Plus you can have multiple and duplicative class action lawsuits. Class action lawsuits are not allowed under present law. I do not think they are allowed under the Nickles bill. I am pretty sure they are not allowed under the Frist-Breaux bill, and they are not allowed in present law under ERISA. Under this bill one can have multiple class action suits under ERISA and under RICO for the same violation. That is why, because of all these different opportunities to sue, I have called it the ``Lawyers Who Want to be Millionaires Act.'' That is why this bill generates such a huge loss of insurance to people. Of course, our goal should be to cause people to be insured, not to become uninsured, but the result of this bill is that the people become uninsured instead of being insured to the tune of at least 1.3 million people, according to CBO's estimate. That is extraordinarily low, by my estimate, but that is still a huge number. Some want to increase the number of uninsured because they see that as the vehicle of putting more pressure on the Federal Government to step in and insure everyone through some nationalized system. But I think we have seen from the experiences of our neighbors in Canada and our friends in England that a nationalized system is not the solution. It produces a huge penalty, and it means that health care deteriorates, it is rationed, and that research and movement into new types of treatments are significantly limited and severely impaired. This bill which creates all these new uninsured, creates all these new lawsuits, and which puts the employer at risk, is off in the wrong direction. We have proposals which do address the needs of patients. They have been proposed by Senators Jeffords, Frist, and Breaux. They have been proposed by Senator Nickles. They are good proposals, and they address the needs of Americans who interface with their HMOs or their other insurers and do not get fair treatment. We are very strongly supportive of those, but we cannot support a bill which, in the name of patients' rights, actually puts more people out on the street and makes more people uninsured, so actually reduces rates. I believe my time has expired.

Mr. GREGG. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. GREGG

Mr. GREGG. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. GREGG

Mr. GREGG. Mr. President, this bill is a very significant bill. It impacts about everybody in America; about 200 million people presently have health insurance. As a result, if we passed a bad law, the unintended, or intended, consequences of it could be dramatic. It is important to take a hard, intense look at what is being proposed by Senator McCain and Senator Kennedy as their bill. This is in the context of bills which have already been proposed by Members from our side, some which are bipartisan such as the Breaux-Frist- Jeffords bill; some do not have Democratic sponsorship, such as the Nickles amendment. All have as their basic purpose the same intent underlying--certainly I give credit to the McCain bill for this. The basic intent is making sure individuals are properly treated when they interface with their insurance companies; that they have an opportunity for redress that is effective, which allows them to be sure that if they get poor treatment, they have some way to correct it; and that if they are harmed by their health care provider, they have the ability to recover proper compensation for that harm. That is a goal all Members have. Everyone who is debating in this Chamber understands the importance of making sure that Americans who get health care have adequate recourse when that health care is not supplied correctly. It is also equally important Americans have a certain set of rights when they are dealing with their health care provider in areas such as the type of physician they would see and the type of referrals they would get and the issue of specialists. That is also equally important. All the proposals that have come forward address that issue. I have not yet heard of a case from the other side of the aisle--and they have presented a number of anecdotal cases, and they are compelling, people who have had problems with their insurers. I have not heard one of those cases where that individual would not have had the ability for redress or be taken care of under either the Nickles or the Breaux- Frist-Jeffords bill. The issue is not about that. It is not about whether or not we are concerned about individuals getting fair treatment from their insurer. It is not about individuals having a set of rights which are protected when they deal with their doctor, who is representing their insurance company, or whether they deal with their insurance company. That is not what this issue is about. It comes down to a couple of substantive questions as to the differences. The first involves States rights versus Federal rights. That is called scope. It is a question of what authority do we have as a Federal Government to take over authority which has traditionally been handled by the States, especially in the area of insurance. Insurance has traditionally been a State responsibility. As a former Governor, I know it is something every State takes very seriously and is very committed to. New Hampshire's laws for protecting patients are much more aggressive than proposals in any of the three packages here. That is one element of difference. The other element is something I want to talk about, the area of liability. Liability is a term that has huge implications. The practical effect of the McCain bill, no doubt about it, is that there are going to be created innumerable opportunities for lawsuits to be initiated against not only insurers but equally against employers, small employers and large employers. Mom-and- pop grocery stores, mom-and-pop gas stations, mom-and-pop restaurants, small, struggling production facilities, software companies, and large employers--Wal-Mart, Ford, whatever, the big ones--those employers are suddenly going to find themselves drawn into literally hundreds of potential opportunities for liability. What is the effect of that? The effect of that is a large number of employers, especially small and midsize employers, are going to throw up their hands and say: Hey, listen, I can't afford the risk. The average malpractice lawsuit in this country costs about $77,000 to defend if you are in an employer situation. There are a lot of small employers for whom $77,000 is their entire profit margin for the whole year. They may get hit with a multiplicity of lawsuits under this bill that do not exist today. This is a new law created for the purposes of creating new lawsuits. This is a bill that is of the lawyer, for the lawyer, and by the lawyer--for the trial lawyer. And the practical implication is that a lot of employers, a lot of people who want to take care of their people they work with, are not going to be able to, and they are going to simply have to drop their insurance. They are probably going to replace--some of them, the more substantive, will be able to replace their insurance by saying to the employee: Go buy your own insurance. Here is the money. They will never get as good a package in most instances as their employer could get for them because they will not have the ability to negotiate with the strength of a large number of individuals. Individuals seeking individual policies simply get charged a lot more than groups that have been pursued as a result of a group of employers banning together or even one large employer banning together and pursuing an insurance company. The quality of the insurance will drop for those individuals. An even greater number of employees are simply not going to have insurance at all because small and midsize employers are simply not going to be able to afford it and they will simply eliminate it as an option they present as a benefit in their workplace. So there will be more uninsured. How can you possibly call something a Patient's Bill of Rights when the practical effect of the bill is to create more people who don't have any insurance at all? So they don't have any rights; they don't have any insurance. If that is the practical effect of the bill, and it is--you don't have to listen to me. Listen to an independent group such as CBO which has scored this bill as putting 1.2 million people out of insurance. That is the conclusion they came to because of the additional costs that result from the lawsuits, in large part. Those people are not going to have insurance. They don't get any new rights under this bill. They lose all the rights they had. Yet this is claimed to be a Patient's Bill of Rights. Very inconsistent, to say the least. In the process of setting this bill up, there has been a presentation from the other side that they actually took the other bills that had been pursued in the last couple of years--remember, we have not had a hearing on any of these bills in our committee now for 2 years, which I think is a little bit much--to bring a bill of this size to the floor without any hearings at all so the people who are going to be affected could have a forum to make their points. Independent of that, there were over the last couple of years bills brought to the floor. There was the prior McCain bill, the prior Kennedy bill, and the prior Norwood-Dingell bill. The representation has been that the McCain bill has moved to the center from those two bills that were introduced before. In fact, that is not true at all. This bill is much more to the left, and by the left I mean it is much more oriented towards undermining the rights of people to buy insurance and have health insurance. By moving to the left, I mean it interferes much more with States rights and it places much more liability on the backs of small employers and also large employers. This bill moves significantly to the left, not to the center. There are ways to move this bill to the center. Breaux-Frist-Jeffords is a bill that has moved to the center from the Nickles bill that was debated and passed in the Senate last year. If you want to argue center, left, right, this bill moves way out into left field, as compared with the original bills which were introduced and were already pretty far out in left field. This bill, if it were in Fenway Park, wouldn't be in left field; it would be in the bullpen. Well, actually that is in right field. It would be behind the Green Monster. I point out a few areas where this occurs. First, as I have mentioned, it significantly expands liability for employers. Sponsors of the McCain bill say they have compromised by including a $5 million cap on punitive damages. However, the cap only applies in the Federal liability provisions added to the bill--it is sort of a bait-and-switch thing--and not to the more expansive liability provisions under State law. One of the ironies of this bill is you can go forum shopping. This is one of the favorite things trial lawyers like to do. I used to do a little bit of trial work. You love to forum shop. You find out what court has the best judge; you find out what court historically has the juries that give the highest award; you find out what court has the best rules to improve your capacity to win your case on procedural grounds; and you move to that court. If it is a Federal court, you go Federal. If it is a State court, you go State. Under the present law, you cannot do that. You cannot bring an ERISA claim in a State court. But under this bill, it expands dramatically the opportunity for forum shopping. Then it says: But, hold it, we put in a cap so you don't have to worry about that. Unfortunately, there are a lot of States that have no cap. They have no limitation at all on damages. Further, the bill itself allows unlimited damages for economic and noneconomic losses--damages within the Federal court system. It expands the right to sue for violations of duty under the plan. This is a brandnew concept. It creates a whole new cause of action out there where employers will suddenly become liable for contractual activity on HIPAA or COBRA or ERISA that they are not liable for today, relative to a private lawsuit. I have a chart. I don't have it on the floor today because I had it up so often I thought people might be getting tired of it. But it shows there are potentially 200 new causes of action just on this one point alone. Then it says it does not have punitive damages. In fact the earlier bills did not have punitive damages. At least H.R. 990, which I think is the original Norwood bill, did not. But, in fact, it creates a new term of art, which is essentially punitive damages, and it allows those damages, as I mentioned, to be recovered at the rate of $5 million. Here is a bill that says it is moving more to the center when, in fact, in the liability area it dramatically expands forum shopping, it dramatically expands punitive damages opportunities, it dramatically expands the number of lawsuits that can be brought on the issue of contracts and contractual obligations of the employer--all of this is directed at the employer--and it dramatically expands, in Federal court, economic and noneconomic damages that can be recovered against the employer. All of this is new. A brandnew attack on the employer by the trial bar will be allowed under this bill. This is not moving to the center. This is moving to the left. Another example, the McCain-Kennedy bill effectively requires that all States pass new patients' protection laws identical to the new Federal requirement. This is a huge step, an intrusion into States rights. Earlier versions of the legislation, both the Daschle-Kennedy bill last year and the Norwood bill, used the standard under the Health Insurance Portability and Accountability Act to determine whether or not State laws would be preempted by the new Federal patients' requirements. That standard does not prevent the application of this Federal law versus requiring the application of the Federal law. The latest McCain bill adds new barriers for States by requiring that State laws be substantially equivalent to and as effective as each new Federal patient protection requirement. This two-part standard will effectively require every State to renegotiate and pass a whole new group of provisions in order that their laws be virtually identical with the Federal provision. If the State fails to do so, the Federal Government will take over and enforce those rules in every State. So I cannot see how you can claim this bill moves to the center when the practical effect of this section is to essentially usurp and wipe out States' activities in this area. My colleague from Maine just spoke a little while ago. She put up a list that showed literally almost every State in the country has aggressively addressed the issue of patients' rights and has established a set of requirements and rights which flow to the patient that are fairly consistent with what we all seek in the Senate. But if they are not exactly or substantially equivalent to and as effective as the Federal law, they will be overruled and the Federal Government will come in and usurp the State authority and actually take over the State's insurance enforcement. We have had State insurance enforcement in this country for quite a while and it has worked pretty well. So you cannot say a bill moves to the center when it essentially says ``to heck with the States, we are coming in, we are the big boys, you are out of the game because we know better than you, State legislatures. You, the State legislature, are not interested in the people who live in your States. We here in Washington are.'' That is not a movement to the center. That is a dramatic, if not radical, move to the left, to centralization of power here in Washington at the expense of the States. In addition, another example of the fact this bill does not move to the center but moves way off beyond the Green Monster, out beyond left field, out past Lansdowne Street, probably down by the Massachusetts Freeway--actually it is not a freeway; it costs money--the Massachusetts Turnpike is the effect this bill has on the ability to bypass the appeals process. The prior proposals, earlier versions which were pretty far left, out there in left field, as I said, of the bill provided where injury or death had already occurred, and therefore the appeals process would be futile, the patient would not be required to exhaust the appeals process before going to court. The new version permits a person to bypass the appeals process and go directly to court to seek monetary damage if the harm would occur by going through the process. That may sound reasonable, but you have to read behind that language for the practical impact of what it is. It is noteworthy that this exception would allow lawsuits for virtually unlimited monetary damages rather than simply allowing patients to get the care they need if they would be substantially harmed by completing the review process. The new version of the McCain bill also contains a late manifestation provision. This is an amazing provision because this provision essentially says that if the appeal process period has run and you decide that you have a manifestation of harm as a result of being treated, you no longer have to go to the appeal process; You can go directly to court. The practical effect of this language is essentially to eliminate the statute of limitations. Under this law there is a total abrogation, in my humble opinion, of the statute of limitations. That is a move to the left. As a trial lawyer, I love the idea that I never have to worry about the statute of limitations because if my office happens to make a mistake and not reach that 3-year window or that 6-year window, I am not going to be subject to the errors and omissions suit that I might get hit with by my client because, if there is no statute of limitations, I will never miss the filing requirement. But going back beyond the manifestations language, this concept that is totally different than what was in the original Dingell-Norwood bill and the original Daschle-Kennedy bill that you as a patient do not have to exhaust your administrative remedies before you go into court, but you simply have to claim harm, and then you can go right after monetary damages, is a dramatic undermining of the capacity to have an effective appeal process. You essentially have no appeal process. Now all you have are court decisions. Nobody is going to go down the appeal process route. Everybody is going to race to the courthouse with this bypass language. The way it should be structured, obviously, is that, sure, if you are injured and you are going to suffer as a result of having to go through the appeal process and you are not getting a response, you should be able to go to court, but you shouldn't get the monetary damages at that time. You should get whatever you need in order to get the right medical care, then go back to the appeal process and find out what the proper resolution should be and then move into the court system for the monetary issues. That is the logical approach. It is actually the approach, for all intents and purposes, that was in the original bill. Now we have another example of moving way over to the left and not moving back to the center, which this bill claims to do. It doesn't move to the center at all. These are not minor issues--the liability issue, going straight to court issue, and the States rights issue. These are not minor issues. These are big questions in the scheme of how we deliver health care. The reason they are big questions is because, if this bill passes, it is going to fundamentally change the way health care is delivered in this country. It will push a lot of people into the uninsured ranks. As a result, you are going to have this huge momentum for the nationalization of our system. At this point, I see our leader coming on the floor. I know he has comments that he wants to make. So I will yield the floor.

Mr. GREGG

Mr. GREGG. Madam President, I thank the assistant majority leader for helping organize the speeches this afternoon. There are a lot of Members who want to talk on this bill. That is reflective of the fact and one of the reasons why we cannot move immediately into the amendment process. It is not that we on this side are not interested in moving to the amendment process; we honestly are. There are many on our side champing at the bit to get into this bill and amend it and address fundamental issues. We also on our side want to have the opportunity to bring forward substantive and thoughtful approaches on how to address this issue in an even more effective way than the bill before us that has been drafted by Senator McCain and Senator Kennedy. The point, however, is that we just got this bill. It was one bill on Wednesday of last week. Then it was a different bill on Thursday. We have had 2 working days. We are talking about the bill, but it is a moving target for us. To get up to speed on it takes a little time, and there are a lot of people who want to talk about that, a lot of people who have had intimate knowledge with what has been going on with this issue for a long time but are not familiar with the specifics of the McCain-Kennedy bill and, therefore, believe they need some time to be brought up to speed before getting into the amendment process. I note as an aside, and I think it is important to note, this is one of the most far-reaching and important pieces of legislation we will address as a Senate this year, certainly on the authorizing level. We just completed another major piece of legislation, the education bill, which is extremely important legislation. We spent 2 weeks--actually 2\1/2\ weeks--on the motion to proceed to the education bill. That was when the Republican Party held the majority in the Senate. At that time, I did not hear Senators from the other side saying we were moving too slowly as we are now hearing today from Senators on the other side, even though we have not spent more than 6 hours on the issue of whether we should proceed. It seems to me there are a few crocodile tears on that issue. There is a legitimate reason for not immediately moving to the bill, and that is we do not know what the bill is, and we do not know the specifics of the bill. We should have a chance to read it before we proceed to it. I use the very excellent example of the position of Members of the other side of the aisle when we were taking up the education bill when they suggested we do 2 weeks. We are not going to suggest 2 weeks, but we are going to suggest a reasonable amount of time to proceed on the issue of reviewing the bill before we address it. This probably would not have been necessary if we had had hearings on this bill. One must remember, there has not been a hearing on this bill that is being brought before us even though it is extremely important legislation. In fact, in the Senate, there have been no hearings on the issue of patients' rights in 2 years--since March of 1999. We have taken up the language of the Patients' Bill of Rights a couple of times, but we have not done any hearings in the committee that has jurisdiction or responsibility in the last 2 years. That is important because at those hearings, we could have gotten constructive input. If we had had hearings on this bill, for example, we would have seen a number of people from communities across this country coming forward--small business people, people who are running mom-and-pop businesses with 9, 10, 15, 20, 30 employees saying: Listen, the hardest thing I have in my business is the cost of health insurance. I want to insure my employees. I want health insurance for them, but if the McCain bill passes, I will not be able to afford health insurance because I suddenly will not only be buying health insurance, I will be buying lawsuits. Instead of the present law which insulates the small employer especially from being sued for medical malpractice or medical malfeasance or medical events that their employees incur in the process of dealing with the health insurer with which the small business individual has contracted, instead of having that insulation, that goes down, the wall goes down. Under this bill, those employers, those small mom-and-pop employers especially--all employers for that matter--will suddenly find themselves being sued for medical issues. A person who runs a restaurant with 30 employees is probably saying: I don't mind being sued if I put out a bad meal and somebody gets sick. That is my responsibility. But if one of my employees to whom I have given health insurance, which I think is important to them, goes to the local doctor and the doctor doesn't treat them correctly or they get bad advice from their insurance company on the way they should have been treated or their options, why should I, as the owner of the little restaurant, end up being drawn into that lawsuit? But I will be under this law, under this proposal as it is structured. I find it consistently ironic that the Senator from North Carolina, who has his name on this bill, continues to say employers are not subject to suits when the bill specifically says employers are subject to suits. It says it in two places that are very significant. He suggested I read his bill. I did read his bill. I might suggest he also take a look at his bill because it does not appear he has, if he continues to conclude employers are not subject to liability. No. 1, the language is, as we mentioned earlier on page 144, very specific. Granted, the headlines for the language are ``exclusion of employers and other plan sponsors.'' But when it gets to part (B), it says, ``notwithstanding [anything] in subparagraph (A), a cause of action may arise against an employer or other plan sponsor. . . .'' That is the term, ``employer.'' I define ``employer'' as employer, not insurance company. I think anybody else would, too. So right there, at the base of it, employers are sued under this bill, and for a significant amount of responsibility here, because the definition of what an employer is going to be sued for goes on to say, ``where the employer participated--had direct participation by the employer or other sponsors in the decision of the plan.'' Direct participation has become an extremely broad term, as I mentioned earlier today. Basically, if the employer says, as you are heading off to the hospital--you are working for the restaurant; there are 30 people at the restaurant and you get burned in the kitchen and the employer says, you have to get down to the hospital, let me make sure you get to this hospital versus that hospital, the employer is libel. The employer is libel for how you are treated at that hospital under this bill. Then there is this new cause of action, which is a massive new expansion of the ability of people to be sued, employers specifically, under this bill. This new cause of action is created by subsection 302, subsection (A)(ii), I think it is the right cite, on page 141 of Senator McCain's bill: . . . otherwise fail to exercise ordinary care in the performance of a duty under the terms or conditions of a plan with respect to a participant or beneficiary. Then, the agent or the plan sponsor is subject to be sued. Plan sponsors are, by definition of ERISA, employers. That is very clear, unequivocal in ERISA. So we are talking about the fact that there is now a new Federal cause of action for what amounts to the failure of a plan, the insurer, to give information which traditionally had been managed through regulatory activity--the failure of that plan to do a whole series of things. I put up a list earlier of potentially 200 different places, between COBRA, HIPAA, and ERISA, that you would have a cause of action that could be brought on an activity of the insurer or people who are involved in the plan in a ministerial way as employers. They would now be subject to lawsuits in a Federal action. There would now be a Federal action against them on that in over 200 different places--not quite 200, somewhere around 200 different places where employers could be sued. I understand--I was not here but it was represented to me by people who were here--that, once again, the Senator from North Carolina said that is not true; that only counts if it is a medically reviewable event. Then that brings in the employer. I don't know. I think I can read language. The language is abundantly clear, and I don't think you can reach that conclusion because the language is clear. The language the Senator quoted in support of that position, which actually is a 180 degree exact opposite conclusion of what the Senator from North Carolina said, the point he was making, if it was correctly represented to me. Under clause (2), again of 302, it says: In General.--A cause of action is established under paragraph (1)(A) only if the decision referred to in clause (i) or the failure described in clause (ii) does not [``not''] include a medically reviewable decision. Just the opposite. It is not because there is a medically reviewable decision that you get brought into this. It is because there was no medically reviewable decision, which means all these ministerial events, which have unlimited liability attached to them, can create the lawsuits against employers. So employers are going to be hit with a plethora of new lawsuits from attorneys across this country. This is a whole new industry. We will have to probably build another 20 or 30 law schools across this country just to take care of all the new lawyers who are going to join the trade in order to make money suing people under this McCain-Kennedy bill. We are going to have to expand law schools radically, which may be good for law schools but I am not sure it is good for our society as a whole. I want to go into a little more depth here, if I have a minute--I understand somebody else is coming to speak--on the specifics so I get it right, especially on this whole issue of the Federal tort claim, this new Federal action. This is a huge event which should not be underestimated. It is technical but it is huge and the implications are radical. We are going to get a chart put up just to make it a little easier for people to understand. Basically what this bill does is it creates two new types of lawsuits in Federal court. Under the first type of action, participants can sue over a failure to exercise ordinary care in making nonmedically reviewable claims determinations. The second Federal cause of action broadly allows suits for failure to perform a duty under the terms and conditions of the plan. Remedies available under the two new claims, these two new ERISA claims, include unlimited economic and noneconomic damages and up to $5 million in what this new euphemism is, ``civil penalties,'' otherwise known as punitive damages. I guess that was too punitive a word to put into this bill so they used the words ``civil penalties.'' They have created these claims. They have taken the tops off the liability and basically said, OK, go find an employer and shoot him dead with unlimited economic damages, unlimited noneconomic damages, and $5 million in punitive damages. The second new ERISA claim, the terms and conditions in the one I just talked about, is extremely broad, covering virtually any administrative action that does not involve a claim for benefits, including the S. 1052 McCain bill new patient protection requirements under COBRA and HIPAA. The McCain bill establishes a complicated scheme which attempts to limit Federal and State suits against employers provided the employer does not directly participate in the decision in question. It is a very complicated scheme, but what is the effect of it? The effect of this direct participation at this time will mean that employer protections are essentially meaningless for suits alleging a failure under the terms and conditions of the plan. Further, the McCain-Kennedy bill continues to allow unfettered class action suits--including suits against employers--where no limits on damages would apply under the current law provisions of ERISA or other Federal statutes, including the RICO statute. So you have, first, a whole new set of Federal claims created against employers, unlimited economic damages, unlimited noneconomic damages and $5 million of punitive damages, which essentially have a figleaf entry level that any good lawyer is going to be able to punch through called directed participation. Then you have the continuation of class action suits giving lawyers another forum with things such as the RICO statute. Because employers inherently carry out their duties under the ERISA's statutory scheme, the McCain-Kennedy bill will leave employers wide open to new Federal personal injury suits. Employers will be sued based on alleged errors in: Offering continuation coverage and providing notices under COBRA; Providing certification of prior credible coverage under HIPAA's portability rules; Distributing summary plan descriptions; describing the plan's claim procedures under the plan; and describing the plan's medical necessity or experimental care benefit exclusions. Here are some of the others: Also, providing notices of material reduction in group health plan benefits as required by ERISA. These are all areas where they can be sued. Also, responding to requests for additional group health plan documents under ERISA; and, finally, group health plan reports under the Department of Labor. In all of these areas they can be sued. The list goes on and on. Employers cannot be sued on this today. All of this is new. This is a brand new litigation area. As I said, we will need to add many new law schools in order to absorb all the new lawyers we will need in order to bring all of these lawsuits. The McCain-Kennedy bill proposes up to $5 million for punitive damages for COBRA, HIPAA reporting, and disclosure violations despite the fact that all of these requirements have their own specific ERISA enforcement provisions. In other words, under present law, there are already enforcement provisions for this activity and the ones I just listed. But they don't run to the employer to benefit the patient. The patient doesn't have an individual cause of action in this area. Rather, these are strong administrative procedures which keep the employer from violating the purposes of ERISA. But now we have punitive damages up to $5 million, unlimited economic damages, and unlimited noneconomic damages. Some of the things that occur today in order to enforce these laws but which do not involve private cause of action as created under the bill are as follows: There is a $100 per day excise tax penalty under Code section 4980B(b) violations of the COBRA requirements--tax penalties are up to $500,000 for employers and $2 million for insurers. There is an additional $100 per day civil penalty under ERISA section 502(c) for failing to satisfy the COBRA notice requirements. Plan participants may sue employers and insurers--for benefits and injunctive relief under ERISA section 502. There is a $100 per day excise tax penalty under Code section 4980D(b) and a $100 per day penalty under section 2722(b)(2) of the Public Health Service Act for violations of the HIPAA preexisting conditions limitations provisions. In addition, plan participants may sue for benefits and injunctive relief under ERISA section 502. Willful violations of ERISA's reporting and disclosure rules, including the requirements relating to the provision of SPD and documents upon request, are subject to criminal fines and imprisonment under ERISA section 501. Failure to provide documents upon request is subject to civil penalties under ERISA section 502(c). So you already have a very extensive administrative and legal liability situation for employers and insurers that do not meet the conditions of COBRA, HIPAA, and ERISA. But what you are now layering on top of that is a brand new concept where you have a private right of action, where individuals can go out and allege these violations as part of the injury they claim they received and have a whole new cause of action against the employer. What small-time employer--what employer, period--is going to want to keep a health plan if they have that level of liability facing them? McCain-Kennedy would impose potentially huge new compensatory and punitive damages remedies for violations of COBRA, HIPAA, and ERISA's disclosure requirements. Moreover, under the statute's own requirements, the employer is specifically required to carry out COBRA and disclosure requirements--the employer is almost always the administrator. Thus, McCain-Kennedy imposes a huge new liability on employers that employers cannot avoid; despite the fact that when Congress adopted COBRA and HIPAA with large bipartisan majorities no discussion was given to the need for punitive damages to enforce the new requirements. Practically what you have here is a decision by the drafters of this bill to say we are not really so much interested in delivering better health care and in giving patients better health care; we are really interested in creating a massive new opportunity for lawsuits. In doing that, I think they are accomplishing one of the goals--which I believe is a subliminal goal and maybe a more formal goal in truism-- which is to create more people who are not ensured because that can be the only conclusion from their lawsuit structure. The only thing that can come from all of these lawsuits, from all of these new causes of action, and from all of the new pressures it will put on employers is that fewer employers will insure their employees, especially small employers. Inevitably, there will be more uninsured. Why would anybody be for more uninsured? If you are around here and you want to pass a national health care plan, the biggest argument you have in your favor is that there are too many uninsured in our country, that the only way to handle the uninsured is to nationalize the system and put everybody into a national plan so everybody is covered. We heard that argument interminably in 1993 when there were only 23 million uninsured. After 8 years of the Clinton administration, there are now something like 42 million uninsured. We have increased the number of uninsured people by 19 million over this approximately 8-year period when we were supposed to be improving our health care delivery system. And the call for a national plan will grow and grow as the number of uninsured grow. If you pass this proposal, because of the costs it will create on employers and because of the increased cost in the insurance premiums, which the Congressional Budget Office scored at 4.2 for every 1 percent of increased cost, CBO estimates that 300,000 people will drop insurance. So 1.2 million people are going to drop their health care insurance. Couple with that this huge, newly built, unintended consequence-- intended consequence; it is not unintended at all--which will be that employers, and especially small employers, will simply say, I am not going to run the risk of being put out of business by these lawsuits which bring me personally into the fray. Then you have the result that more and more people will become uninsured. Thus, more and more pressure is created in the marketplace of politics for a nationalized plan. You have to remember, if you are a small businessperson and you are employing 20, 30, or 50, or even 100 people, and you are confronted with one of these law lawsuits--which you suddenly find you are confronted with because the Federal law has the ability of making you personally liable because you happen to be the employer or the health plan sponsor--what is your alternative? What are your alternatives as a small businessperson? You have to go out and hire an attorney. How much is that going to cost you? It will cost literally tens of thousands of dollars probably to defend yourself in court or you have to settle the suit. Even though you don't believe you owe anything, you have to settle the suit rather than pay the attorneys or you decide to pay the person who brought the suit. That is going to cost you a lot of money. Either way, as a small employer, if you are running a mom-and-pop restaurant, it will probably wipe out your profit because you suddenly find that you are subject to lawsuits to which you were never subject before simply because you gave health insurance to your employees. It is absolutely the wrong result. We have heard a lot from the other side of the aisle about individuals who had serious problems with HMOs. We are all sympathetic to those individuals. Photographs that have been brought to this Chamber--and brought to this Chamber last time--by Members from different States are very moving photographs. But you have to remember, that is not the issue here because the proposal put forward by Senator Nickles last time, the proposal put forward by Senators Frist, Breaux, and Jeffords, and the proposal from Senators Kennedy and McCain, all take care of those individuals' concerns. Those are straw men. None of those folks, I suspect--or the vast majority of them; I suspect none of them--would have the problems they had with their HMO if any one of those three bills passed because all those bills had a very aggressive procedure for redress for the person who believes they are not getting fair treatment from their HMO--very aggressive. All of those bills had very extensive proposals for coverage of different types of services which people believe they have a right to, and should be able to get, and should not have to have their HMO telling them what it is they should have and what it is they should not have--whether it is their OB/GYN or specialists or a primary care provider. All of them have that language or rely on State law which has that language and which is equal to the language in the bill that is being proposed. So those issues, as compelling as they are, truly are not relevant to the debate in this Chamber because under anything that passes this Chamber, you have a 100-percent vote to take care of those issues. The question before this Chamber is whether or not we are going to drive up the costs of health care by creating new liability for employers, forcing employers to drop health care, and whether or not we are going to usurp the authority of States to set out their ideas as to how to address this issue, where many States have already done an extraordinarily good job and really do not need a Federal law in order to protect their citizenry because the protections have already occurred. There are a lot of other issues in here, too--lesser issues. But those are the two big ones. That is what this debate is about. It is not about the folks who have not been treated well because those folks are going to be treated well under whatever bill passes. And it is not about people not being able to go to their health care provider and get the type of specialists or the type of treatment they want in a context which everyone would describe as reasonable because that is in every one of these bills. It is about the cost of health care, the liability of employers, and the usurpation of States rights with States having the opportunity to legislate in the area of insurance which for years is something that has been a tradition in this country. So as we go down the road--and hopefully we will get a final form of a bill to debate from--I believe that is the proper framing of this debate. I look forward to it. I yield the remainder of our time to the Senator from Texas.

Mr. GREGG

Mr. GREGG. Mr. President, the goal here should be this: When you go to see a doctor and you go to your HMO, if that is who covers you, you should expect to get good treatment. If you don't get good treatment, you should have relief. And you should expect to have a certain amount of flexibility as to who you see and especially with some very common events such as OB/GYN and areas such as that, where you should have the capacity as the patient to make some choices: your primary care provider, things such as that. That is all accomplishable. In fact, the bills that have been brought forward from our side of the aisle--some of them in a bipartisan way, such as the Breaux-Frist-Jeffords bill, last year's, the Nickles amendment, which did not have any Democratic support--have accomplished that. In the process of accomplishing that, we should not fundamentally undermine the interests of employers to participate in health insurance for their employees, which is what, unfortunately, the McCain bill does. And we should not do unnecessary and significant damage to States rights which is, unfortunately, what the McCain bill does. That is a whole other discussion. There are a variety of other problems. The goal can be accomplished, which is better health care and better protection of our patients and people who use our health care system without this very egregious, very intrusive, very litigious piece of law being passed. To reiterate, this is not a debate about whether patients should have rights. This is not a debate about whether patients should be able to go the nearest emergency room without being penalized. This is not a debate whether a patient should be able to access a specialist with appropriate expertise and training; prescription drugs that are medically necessary and appropriate; or comprehensive information about their health plan. This is not a debate about whether a female patient should be able to directly access OB/GYN without prior authorization, nor is it a debate whether the parents of a child should be able to designate a pediatrician as their child's primary care provider. This is not a debate about whether a pregnant, sick, or terminally ill patient is able to continue receiving care from her physician through the entire course of treatment--even if the plan terminates her physician from the network. This is not a debate about whether physicians are able to tell their patients about all treatment options without being gagged by the health plan. This is not a debate about whether there should be procedures to ensure that health plans make timely decisions and patients have the right to both an internal appeal to the plan and an independent external review when a plan denies coverage. And this is not a debate about whether the external review is independent from the plan and the reviewer makes a decision based on the best medical evidence and highest standard of care. This is not a debate about whether all Americans should enjoy these types of rights. This is not a debate about whether patient rights should be enforceable or even whether a patient should be fairly compensated when harmed or killed by the decision of his or her health plan or HMO. We agree on all these issues. Both sides share these goals. Democrats and Republicans. The real debate is about how we can best achieve these common goals. It's about putting patients first--ahead of special interests. It's about accomplishing these goals without driving up health care costs, giving employers more reasons to drop health coverage, adding millions more Americans to join the ranks of the uninsured, or dismantling our private, employer-based health care system. The bill we are about to debate--the Bipartisan Patient Protection Act sponsored by Senators McCain, Edwards, and Kennedy--fails on all these counts. I believe we can accomplish our common goals without inviting these unintended consequences. Unfortunately, there appears to be no interest from the majority in addressing these concerns. Senator Daschle said recently that he sees no reason to compromise or address these concerns. I think that is very unfortunate for consumers and for patients. I would like to highlight the very real problems in this bill, S. 1052 which was just introduced on June 14. The McCain bill creates two opportunities to take a bite at the apple. First, it allows unlimited lawsuits against health plans and employers under state law. Second, it creates an expansive new remedy with very large damages under federal law. The dual Federal-State scheme under the McCain bill will encourage dual claims and forum shopping. Plaintiff's lawyers will shop around for the forum with the highest limits on damages. And there is nothing in the bill that would prohibit suits based on the same or a similar set of facts from being filed simultaneously or consecutively in both State and Federal court. This dual Federal-State scheme will raise complicated and costly jurisdictional questions and will ensure that plan benefits and administration will vary from State to State. This will only serve to confuse patients who are already faced with the task of navigating a complex health care system. This scheme will also impose needless and excessive costs that will discourage employers from sponsoring health plans. It will ultimately increase the ranks of the uninsured. Federal courts have been routinely hearing cases involving complicated employee benefit cases. The McCain bill would essentially remove all coverage and claims decisions from Federal court and place them under State jurisdiction, even though States have no experience with ERISA and employer-sponsored benefits. Federal courts have honed their expertise in resolving complicated employee benefits issues since they were given exclusive jurisdiction over such cases in the Employee Retirement Income and Security Act of 1974, ERISA. Approximately 10,000 ERISA cases are filed each year in Federal court. In order to provide high quality and affordable benefits to employees, employers that sponsor health plans across State lines must be able to administer their benefits in a uniform, consistent and equitable manner. The McCain bill will produce multiple and conflicting State laws, regulations and court interpretations, making it difficult for employers to administer their health plans. Congress' rationale for giving Federal courts exclusive jurisdiction with respect to remedies is as applicable today as it was in 1974. From ERISA's legislative history: ``It is evident that the operations of employee benefit plans are increasingly interstate. The uniformity of decision which the Act is designed to foster will help administrators, fiduciaries and participants to predict the legality of proposed actions without the necessity of reference to varying state laws.'' Proponents of the McCain-Edwards bill would have you believe that they have compromised by adding a $5 million cap on punitive damages for the Federal cause of action. But this cap is merely illusory. The bill has no caps on Federal or State economic or non-economic damages. Plus, there are no caps on damages specified for the numerous lawsuits that would fall under State jurisdiction. And there is no evidence to suggest that State law caps would be applied to these various causes of action. In fact, most State medical malpractice law damage caps only apply to physicians and other health professionals-- not health plans. California is one such example. Excessive damage awards only harm physicians and patients. According to a study by Tillinghast-Towers Perrin, health plan liability will increase physician medical malpractice liability premiums by 8 to 20 percent because plaintiffs will target all possible defendants, including physicians. These costs will be passed on to patients in the form of higher premiums or reduced coverage. Health plans will also pass on the increased costs of being exposed to large damage awards to employers who will in turn pass the costs on to employees or reduce or terminate coverage. The McCain bill allows patients to go straight to court--for the purpose of collecting monetary damages--without exhausting administrative remedies first. The independent medical review process is the best, most efficient remedy for the majority of patients. It ensures that patients get the medical care when they need it. In contrast, tort damages are only available to patients after they are injured. The ``go straight to court provision'' creates a perverse incentive for patients, encouraged by their attorneys, to bypass the review process in order to seek the big damages awards in court. Proponents of the exhaustion loophole argue that external review is ``not enough.'' They would have you believe that an exhaustion requirement somehow precludes the ability of an injured patient to seek recourse in court. But this is not the case. The external review process is merely a required and beneficial step before going to court. The high standards that the medical reviewer is required to follow will help inform the court's decisions in determining whether the plan decision was the right one. Just as a medical expert is not versed in the specifics of the law, the court is not well versed in medicine and will benefit from the finding of the independent, external review--as will the patient. The McCain bill allows the medical reviewer to consider but ``not be bound by'' a plan's definition of medical necessity which may be used to determine whether a plan covers a benefit. In effect, this allows the medical reviewer to ignore contract definitions of medical necessity and substitute their own definitions or opinions as a basis for overturning a health plan's decision. This provision would lead to routine reversals of health plan decisions and generate increased litigation. Employers and health plans would have no predictability in administering their plans or estimating their exposure to liability. Alternatively, this may cause plans to routinely approve all coverage thereby driving up premiums astronomically and raising quality and safety concerns for the patient. Employers may reconsider their commitment to offer and administer health benefits if the McCain bill becomes law. Health plans and employers that honor their contractual obligations could be on the losing end of a lawsuit when an external medical reviewer decides to disregard a term in the health plan contract. Even plans that adhere carefully to the terms of their contracts, no matter how generous those terms are, could be held liable if the reviewer decides to apply a different standard. Contrary to continued assertions by its proponents, the McCain bill does not protect employers from open-ended liability. In fact, the bill specifically authorizes certain types of lawsuits to be brought against employers in Federal court for failing to perform a duty under the terms and conditions of the plan. Because employers are required to carry out a broad range of administrative duties under ERISA's statutory scheme, the McCain bill will leave them wide open to new Federal personal injury suits. Employers will be sued for all types of alleged errors such as issuing notices required by the Health Insurance Portability and Accountability Act, HIPAA, and the COBRA, regardless of whether such errors result in a denial of a covered benefit. The McCain bill would impose potentially huge new compensatory and punitive damages remedies for violations of COBRA, HIPAA, and ERISA's disclosure requirements. Moreover, under the statute's own requirements, the employer is specifically required to carry out COBRA and disclosure requirements. The employer is almost always the administrator. Thus, McCain-Kennedy imposes a huge new liability on employers that employers cannot avoid; despite the fact that when Congress adopted COBRA and HIPAA with large bipartisan majorities no discussion was given to the need for punitive damages to enforce the new requirements. The ``direct participation'' provision in the McCain bill provides little comfort to employers who will still be dragged into court on every case. Employers who do not ``directly participate'' in such decisions are not protected from being sued; they are only provided with a defense to raise in court.

Mr. GREGG. I ask unanimous consent for 2 more minutes.

Mr. GREGG. Mr. President, I had not intended to speak right now, but I do think some of the things that have been said in this Chamber do need to be responded to because it is very obvious there is a significant disagreement, and it is a disagreement which is core to this issue. First off, let's begin with the question of how this bill is coming forward. You have to remember, this bill has not had a hearing since March of 1999. We have not had any hearings on this particular bill. And this is one heck of a complicated bill. The bill on Wednesday was not the bill we got on Thursday. So when the other side says we are delaying, I think that is a little bit of a straw man debate primarily because, as a matter of responsibility, we have to at least read the bill. And then we have to figure out what is in it. One of the big issues in relation to what is in it is what effect this will have on employers. I think the language is unequivocal on that point. The language in section (B), as I cited before, 144, says: A cause of action may arise against an employer. Sure they have the nice title, ``Exclusion of Employers,'' but they wipe out that language with the language which says: Notwithstanding anything in subparagraph (A)--that is the one with the nice title on it, ``Exclusion of Employers''--a cause of action may arise against an employer or other plan sponsor--and then it lists why. One of the standards here is if the employer had direct participation. And ``direct participation'' has become a word of art that is incredibly broad. ``Direct participation'' just means an employer had to maybe wink at his employee, as he headed off to his doctor's office, and say: Hope you get better. As a practical matter, today direct participation essentially brings in every employer in this country that has a plan. That is why a lot of employers are going to drop their plans. That is why no employer group supports the McCain bill--none--because it is an attack on employers, as versus a legitimate effort to try to get at malfeasance, misfeasance negligence in the areas of HMOs. We all want to make sure that people who are poorly treated by their HMO have a right for recovery. We put together proposals which accomplish that. But let's not draw all the employers into the process and stick them with lawyers running around them in circles, suing them like crazy, shooting arrows at them, trying to recover from them because then we will drive the employers out of the insurance market, and more people will be uninsured. That is why it is projected that this bill will increase the number of uninsured by over 1.2 million people. I am a little surprised that some of the sponsors of this bill want to expand the number of uninsured in this country. I think some supporters of this bill may want to because there is, I believe, a belief that nationalization of the health care system is a good idea, and one way to energize support for nationalization is to have a lot of uninsured. But I am hopeful some of the other folks who look at this bill and are supportive will say: Hold it. That was not our intent. We didn't want to drive employers out of the business of insuring and cause more people to be uninsured. We wanted to do just the opposite. So this language is extremely broad, extremely pervasive, and will attack the employers of America--small employers, employers with 10 employees, with 5 employees, with 25 employees, with 50 employees. There is no exemption in this bill. Then there is other language in this bill. This bill creates a whole new cause of action against employers that has never been seen before, a whole new Federal cause of action. And it is a biggy. This is one where lawyers can really have a good time because, under this bill, it makes the employers responsible for the performance of the duties under the terms and conditions of the plan. This is a brand new concept under Federal law. It defines the people responsible, as I said earlier, as plan sponsors. Plan sponsors, under ERISA, are defined as employers. It brings in the employers. We went through the different obligations under a plan that an insurance company has that offers that plan and which are enforceable, not today by the individual but by a variety of different processes. We calculate that there are potentially 200 new opportunities for private causes of action against employers as a result of this language. There are a lot of lawsuits because there are a lot of lawyers who can take those 200 opportunities and multiply them. That is one of those factors which has an infinity symbol beside it as to the number of potential lawsuits, that little circle you learned in eighth grade when you took physics, a little infinity circle connecting the lawyers to lawsuits as a result of this language. I would rename this bill ``the lawyers who want to be a millionaire act'' because that is essentially what it is. This representation that employers are not subject to liability is absolutely inaccurate. Under the clear terms of the bill itself, it is absolutely inaccurate. What is the practical effect of this bill? This issue is not about, as the Senator from Massachusetts outlined, a whole series of coverages that people need. This is not about that. We give those coverages in our State. Most States have those coverages as a requirement in their States. It is not about that. It is not about whether or not a patient has access to a specialist, and it is not about whether or not a woman has access to an OB/GYN. All of that is available and should be available. Those are being thrown up as red herrings to try to develop support. That issue is not even on the table because there is hardly a State in the country that does not give those types of coverages and require those types of coverages of their HMOs. It is not about whether a patient should have a timely right to appeals, both internal and external, because all the laws, all the proposals that have come forward have done that. It is not about that. It is not about whether a patient should be compensated if they get harmed by their doctor or their HMO. All of the bills that have come forward, all the proposals that have come forward have had that as part of their language. All these bills share those same goals. This is about a dramatic expansion in the opportunity to sue. That is what the bill is about, as it is brought forward; specifically, to sue employers, with the practical effect being that more people will be uninsured in our country today because more employers will drop their insurance. The number of new opportunities in this bill for lawyers to create havoc is significant. You have the fact that you can basically forum shop between States and Federal law. You have States stepping into the area of ERISA. ERISA is an incredibly complex piece of legislation on which Federal courts have spent a lot of time developing expertise. There has been over 10,000 cases on ERISA decisions. Suddenly Federal and State courts are going to take on this issue. Not only are they going to get to take it on, but they are going to get to take it on without any liability caps. Essentially, there are no liability caps against health plans. There may be caps against doctors in some States, but take California; they don't have caps against health plans. There are no liability caps. You are going to have punitive damages, economic damages without caps. The implication of what that means is that you are going to have forum shopping from State to State, depending on which State makes the most sense for a person, which structure makes the most sense for a lawyer to pursue. Then you are going to have them proceeding in that structure. And you are going to have the employer brought in. Plus this concept that you have to go through an appeals process before you get to bring a lawsuit is also totally subjugated in this bill. The way this bill is structured, all you have to do is show harm and you are out of the appeal process--or alleged harm. Originally it was ``alleged'' harm. Basically, you get into court and claim you show harm and then everything else gets to the table. No more appeals process of any nature. The concept of trying to reduce the amount of litigation by having a reasonable appeal process is totally undermined by this bill. It should also be noted that the economic impact of this bill has been scored not by me, not by some political organization, but by CBO. This bill costs 4.2 percent. That is not over 5 or 10 years, as was represented here earlier. That is an annual cost on top of the health care costs which are inflating fairly rapidly right now. A 4.2 percent increase translates into a very significant increase, as has been mentioned earlier, in the uninsured because employers will have to drop their insurance because they can't afford it. That should not be our goal here. What should our goal be?

Mr. GREGG. I am asking that the time for the recess be extended beyond the Senator's period for 10 additional minutes and that I be recognized.

Mr. GREGG. Mr. President, I ask unanimous consent that at the expiration of the discussion of the Senator from Massachusetts I be given 10 minutes.

Mr. GREGG. Will the Senator yield for a question?

Mr. GREGG. The Senator asked me a question. Doesn't he want me to respond?

Mr. GREGG. No. I actually agree with the principle. I think the President's point was that employers generally should not be subjected and opened up to massive liability. And this bill does that. That is why I asked the Senator to explain the section.

Mr. GREGG. If the Senator will yield, I am not asking the President.