Ted Kennedy

Mr. KENNEDY

Mr. KENNEDY. I understand there are 3 minutes to a side.

Mr. KENNEDY. I move to reconsider the vote.

Mr. KENNEDY. Madam President, I am prepared to yield back the minute on the Grassley motion. As I understand it, Senator Grassley is going to yield back his time. I ask for the yeas and nays on both the Grassley motion and the Gramm amendment.

Mr. KENNEDY. Mr. President, this legislation is very simple. The point of the overall Patients' Bill of Rights is to permit doctors to make the final, ultimate decision on what is in the best interest of the patient. Doctors, nurses, trained personnel, and the family should be making that judgment. However, we find that the HMOs are overriding them. Now we have put this into the legislation. If it is demonstrated with internal and external appeals that a HMO has overridden the doctors, they are going to have a responsibility towards the patient. They are going to have to give that person, who might have been irreparably hurt, or the patient's family, if the patient died, the opportunity to have some satisfaction. What the Gramm amendment says is, if that same judgment is made by the employers, they are somehow going to be free and clear. He can distort, misrepresent and misstate what is in this legislation, but we know what is in the legislation. What it does is hold the employer that is acting in the place of the HMO accountable. If the employer is making a medical decision that may harm an individual or patient, or may cause that patient's life or serious illness, they should bear responsibility. Under the Gramm amendment, they can be free and clear of any kind of responsibility no matter how badly hurt that patient is. That is absolutely wrong. I can see the case where the HMO is sued. The HMO says: Don't speak to me; it was the employer that did it. And then the employer says: Look, the Gramm amendment was passed. We are not responsible at all. This amendment is another loophole. It is a poison pill. It is a way to basically undermine the whole purpose of the legislation. Doctors and nurses should be making medical decisions and not the HMO bean counters who are looking out for the profits of the HMOs. Employers should not be making these medical decisions either. They may say, every time my employee has some medical procedure that is over $50,000, call me, HMO. I don't want to pay more than $50,000. Then the HMO calls them up and the employer says, no way, don't give that kind of medical treatment to my employee. The HMO listens to the employer, the patient does not get that treatment, and dies. Under the Gramm amendment, there will be no accountability. I hope his amendment is defeated.

Mr. KENNEDY. Mr. President, let me yield myself the time. As I understand, the Senator from Texas is going to close.

Mr. KENNEDY. And that the Senator from Iowa have 2 minutes.

Mr. KENNEDY. I yield 5 minutes to the Senator from North Carolina and the Senator from Arizona the remaining time.

Mr. KENNEDY. How much time remains?

Mr. KENNEDY. At the present time, a small number of employers are interfering with medical decisions. If the Gramm amendment is accepted, this will put the good employers at a serious disadvantage in competition with others, does he not agree? Would not the others be able to formulate a structure so they could effectively cut back on excessive costs for the health care system for their employees, while the good ones who are playing by the rules would be put at a rather important competitive disadvantage? Does the Senator not agree that for the employers working within the system and playing by the rules, this is an invitation to change their whole structure and to be tempted to shortchange the coverage and protection for their employees?

Mr. KENNEDY. I yield another 2 minutes. Does not the Senator agree that the majority of employers now are doing a good job and are not interfering with these medical decisions?

Mr. KENNEDY. Will the Senator yield?

Mr. KENNEDY. I yield the Senator from North Carolina 15 minutes.

Mr. KENNEDY. I will yield myself 2 minutes. I want to remind my good friend from Tennessee when he talks about the issues of cost, that we have heard this issue raised before by the Chamber of Commerce regarding family and medical leave. They estimated that its cost would be $27 billion a year. It has been a fraction of that. I don't hear Members wanting to repeal it. We heard about the issue of cost when we passed Kassebaum-Kennedy, which permits insurance portability, and is used particularly by the disabled. We heard that Kassebaum-Kennedy was estimated to cost tens of billions of dollars. That cost has not developed. Nobody is trying to repeal it. We heard about costs when we passed an increase in the minimum wage. We heard that it would lead to inflation and lost wages. We have responded to that. The cost issue has always been brought up. I will remind the Senator that we have put in the Record the pay for William McGuire and United Health Group, the largest HMO in the country. The total compensation is $54 million and $357 million in stock options for a total compensation of $411 million per year. That is $4.25 per premium holder. The best estimate of ours is $1.19, and you get the protections. We can go down the list of the top HMOs they are making well over $10 million a year and are averaging $64 million in stock options. We could encourage some of those who want to do something in terms of the cost, to work on this issue, Mr. President. In the 1970s, we welcomed, as the principal author of the HMO legislation, the opportunity to try to change the financial incentives for decapitation, to keep people healthy. There would be greater profits for HMOs. It is a good concept. To treat people and families holistically is a valid concept and works in the best HMOs. What happened is that HMOs, and in many instances, employers, started to make decisions that failed to live up to the commitment they made to the patient when the patient signed on and started paying the premiums. That is what this is about. The patient signs on and says: I am going to have coverage if I am in a serious accident. Then we have the illustration of the person who broke their leg and the employer said: Absolutely not. We are cutting off all assistance. That person was left out in the cold. There is no reason to do that. The only people who have to fear these provisions are those employers that make adverse decisions with regard to an employee's health. It seems to me they should not be held free from accountability any more than anyone else should be. How much time remains? I yield 12 minutes to the Senator from North Carolina and that will leave me how much?

Mr. KENNEDY. How much time remains?

Mr. KENNEDY. Mr. President, I yield myself 15 minutes. Mr. President, the Senate recently completed major education reform after six weeks of debate focused on accountability. We agreed that in order to persuade schools to live up to high standards, serious consequences were needed for schools that failed to improve. Republicans in particular emphasized the need for tough financial sanctions. The risk of losing funds, they argued, is an appropriate and necessary incentive to achieve high performance. This emphasis on accountability is not new. It was also the hallmark of welfare reform, and the Senate has applied the same principle to many other programs as well. Over and over, our Republican friends have argued that increased accountability is the way to produce responsible behavior. It is ironic that some of those who have called for accountability most vigorously in these other debates now oppose accountability for HMOs and health insurance companies when their misconduct seriously injures patients. It is irresponsible to suggest that HMOs and insurance companies should not face serious financial consequences when their misconduct causes serious injury or death. If ever there was a need for accountability, it is by those responsible for providing medical care. The consequences can be extremely serious when an HMO or an insurer denies or indefinitely delays access to essential medical treatment. It can literally be a matter of life and death. Yet there is overwhelming evidence that access to care is being denied in many cases for financial, not medical, reasons. And after five years of debating this issue, we've finally reached the point where very few Senators will come to the floor and openly claim that HMOs and health insurers should not be held accountable in court when they hurt people. These corporations desperately want to keep the immunity that they currently have, immunity that no other business in America enjoys. But the HMOs and insurers have behaved so irresponsibly and hurt so many people that they are finally in danger of losing it. Too many children have died, too many families have suffered, for even the HMOs' closest allies to stand here and say that they do not need to be held accountable. So instead, the HMOs' multi-million dollar lobbyists and their allies in Congress have devised a strategy for killing this legislation without directly questioning the need to hold HMOs accountable. Indeed, some of those who repeatedly called for accountability in other areas are the very same members who are searching for ways to enable these companies to escape accountability when their misconduct seriously injures people. The pending amendment by Senator Gramm is a perfect example of this strategy of collateral attack--an attempt to kill this legislation by distorting what it would actually do, and by seeking to turn the focus away from HMO misconduct. Those supporting the Gramm amendment claim that all employers are endangered by this legislation. Such claims are wrong. The vast majority of employers who provide health care merely pay for the benefit. They do not make medical judgments, they do not decide individual requests for medical treatment. Thus, under our legislation, they have no liability. The only employers who would be liable are the very few who step into the shoes of the doctor or the health care provider and make final medical decisions. Our legislation only allows employers to be held liable in court when they assume the role of the HMO or the health insurance company. By completely exempting employers from all liability no matter how closely tied the employer is to an HMO and no matter how severe the employer's misconduct, Senator Gramm's proposal aims to break the link of accountability in this bill. President Bush stated in the ``Principles'' for the Patients' Bill of Rights which he issued on February 7th: ``Only employers who retain responsibility for and make final medical decisions should be subject to suit.'' That is consistent with what our bill does. But Senator Gramm's amendment is directly at odds with the President's principle. The Gramm amendment would mean that ``employers who retain responsibility for and make final medical decisions'' could not be sued. I'm surprised that the Senators from Texas would propose such an extreme approach--eliminating all accountability for employers no matter what they do. Under their proposal, employers are never held accountable, period, even if an employer causes the death of a worker's child by interfering in medical decisions that should have been made by doctors. The Gramm amendment is a poison pill designed to kill this legislation. Not only does it absolve employers of liability regardless of how egregious their conduct, it also creates a loophole so enormous that every health plan in America would look for a way to reorganize in order to qualify for the absolute immunity provided by the Gramm amendment. Senator Gramm creates a safe harbor so broad that it will attract every boat in the fleet. We all know what would happen if this amendment became law. HMO lawyers would craft contracts that enable them to be treated as employees of the companies they serve, so HMOs could take advantage of Senator Gramm's absolute immunity. Other employers would turn to self insurance as an obvious way to avoid accountability for the actions of their health plans. Health insurance companies would rework their contracts to give employers the final say on benefit determinations in order to take advantage of this shield from accountability. Today fewer than 5 percent of employers assume direct responsibility for medical decisions on behalf of their employees. But if the Gramm amendment became law, the share of employers taking on these decisions would grow enormously. By providing absolute immunity from accountability, the Gramm amendment creates a strong incentive for employers to intervene in medical decisions, despite the fact that most employers are not qualified to do so. Employers and HMOs are free to negotiate any relationship they want, and that relationship can be detailed in writing, or it can be detailed in informal ``understandings'' that workers never get to see. What the Gramm amendment does is leave families completely vulnerable to the most unscrupulous HMOs and employers. For example, an employer could demand that an HMO call it for approval before allowing any treatment that would cost over a certain amount, compromising the patient's privacy and enabling the employer to make medical decisions based on cost alone. The Gramm amendment would completely shield an employer who causes grave injury or death in this way, and the HMO might also escape liability because it could show that the employer alone made the final decision. Subtler employers could instruct their HMOs to delay or complicate the treatment approval process for certain kinds of medical care or for certain employees. The Gramm amendment would allow an employer to require its HMO to send it all requests for mammograms, and the employer would not be accountable if it chose to delay or deny a request for a mammogram that would have timely detected breast cancer. The same employer practice can interfere with many diagnostic and treatment decisions. As Judy Lerner discovered, there is no end to the irresponsible behavior of some unscrupulous employers. Ms. Lerner worked in Boston for over two decades as a consultant in a human resources firm that self insured, and she relied on the health benefits that the company provided. But when she broke her leg in several places and endured emergency surgery, the company simply stopped helping with her medical bills, agreeing only to pay for crutches. Despite her doctors' vigorous arguments for continued home medical care, the company abandoned her. The Gramm amendment would leave all employees like Ms. Lerner vulnerable after they have been told that their medical bills would be covered at the time they accepted employment and begin working hard. The Gramm amendment allows employers to deny necessary medical treatment any time it suddenly becomes too costly or inconvenient, regardless of how much the employee has relied on that coverage. Most employers, of course, would not find it morally acceptable to intervene in medical decisions against their employees. But if I were a small business owner, I wouldn't want to compete in the environment created by the Gramm amendment because it gives the worst employers an economic incentive to cut corners on employee health care and frees them from all accountability when they do so. It would create an uneven playing field, allowing unscrupulous employers to gain a business advantage over their honorable competitors. As the President says, ``employers who retain responsibility for and make final medical decisions should be subject to suit.'' That is what President Bush wants, and that is what we want to accomplish. I am confident that the McCain-Edwards language accomplishes this, but I remain open to other ideas for writing President Bush's principle into law. Under our language, employers have no liability as long as they do not make decisions about whether a specific beneficiary receives necessary medical care. The only employers who can be brought into court are the very few who step into the shoes of the doctor or the health care provider and make final medical decisions. Our bill does not authorize suit against an employer or other plan sponsor unless ``there was direct participation by the employer or other plan sponsor.'' ``Direct participation'' is defined as the ``actual making of such decision or the actual exercise of control'' over the individual patient's claim for necessary medical treatment. Our bill directly protects employers from liability by stating: ``Participation . . . in the selection of the group health plan or health insurance coverage involved or the third party administration'' will not give rise to liability; ``Engagement . . . in any cost-benefit analyses undertaken in connection with the selection of, or continued maintenance of, the plan or coverage'' will not give rise to liability; ``Participation . . . in the design of any benefit under the plan, including the amount of co-payment and limits connected with such benefit'' will not give rise to liability. Our language is clear. As long as the employer does not become involved in individual cases it is immunized from suit. Employers are very well protected by our legislation as it is written. We are pleased to consider other strategies for accomplishing President Bush's principle on this issue, but the loophole that the Texas Senators propose fundamentally contradicts the President's principle and ours. Senator Snowe and others are working on language to codify that principle, and I am looking forward to seeing their ideas. The Gramm amendment is exactly the wrong medicine for America. It deserves to be soundly defeated for the sake of a level playing field for all employers, and for the good health of employees and their families. Mr. President, I reserve the remainder of my time.

Mr. KENNEDY. Mr. President, how much time remains?

Mr. KENNEDY. Mr. President, I yield such time as the Senator from Montana desires.

Mr. KENNEDY

Mr. KENNEDY. Madam President, I move to reconsider the vote, and I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. KENNEDY. If I could have the attention of the Senator from Arizona, he has 5 minutes remaining. The Senator from New York has been active and involved in the clinical trial issue and will address it. May I yield the remaining time to the Senator from New York?

Mr. KENNEDY. I will take half a minute. Can the Senator show me where the appeals provisions are in his bill with regard to speciality care? Can he refer me to that in his proposal? My understanding is that there is no appeal by the patient. Once the judgment is made to reject the speciality care, there is no appeals provision. The Senator from Tennessee has given us an assurance that there is. I ask--not right now--if he can give us the parts of his legislation that indicate that because we have not been able to see that.

Mr. KENNEDY. I only have 6 minutes left.

Mr. KENNEDY. We only have 6 minutes.

Mr. KENNEDY. If I understand, and we will have a chance to talk about the appeals process----

Mr. KENNEDY. The plan makes the decision that specialty care is necessary. However, if the plan says no and the patient believes that it is necessary, what rights does the patient have to question the decision that is made?

Mr. KENNEDY. Will the Senator yield on that point?