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http://www.nytimes.com/2002/06/30/business/yourmoney/30FIVE.html

Better Medical Decisions, Not Higher Costs

By MILT FREUDENHEIM

he Supreme Court ruled this month that states had the right to insist on an independent review for patients whose managed health care plans refused to pay for a treatment or drug prescribed by their doctor.

Congress has yet to pass a patients' bill of rights that would include independent reviews of medical disputes. However, 42 states and the District of Columbia currently have health care review laws. And most big managed-care companies now have some type of outside review process, according to the American Association of Health Plans, a trade group in Washington.

The Supreme Court ruling did not apply to self-insured plans in which large and midsized employers assume the risks of paying for any medical bills their employees may incur. But it did strengthen the authority of states to protect patients. At the same time, it weakened a federal law, the Employee Retirement Income Security Act, or Erisa. That law, which regulates pensions, also required that health care disputes be taken to federal courts, where jury awards to plaintiffs are limited. Erisa has often been invoked by health plan operators to pre-empt state laws and regulations.

Robert D. Reischauer, president of the Urban Institute, a research and public policy center in Washington, is a former director of the Congressional Budget Office and an expert on health care policy. He spoke last Thursday about the ruling.


Q. Health plan operators have argued that state health care laws and regulations add to the costs paid by consumers and employers. Will these costs go up after the Supreme Court ruling?

A. I don't think so. The behavior of managed-care companies has changed modestly in those areas where these review processes are in place. The bottom line is that there is probably more careful decision-making by the companies, not necessarily that costs have been significantly pushed up.

Q. Will the ruling be a problem for the insurance companies?

A. There will be a period of transition. Often, during a transition, there is a bit of disruption. This is not something that should reach significant levels.

Q. Are doctors on independent review boards inclined to say yes to most medical procedures, overruling denials by the health plans?

A. To the extent that that is true, it is in society's best interests. If we are going to err, it's better to save lives than to save money. But the evidence suggests that these review panels take their responsibilities very seriously.

Q. Will the court ruling help or hinder efforts to get a federal patients' rights law through Congress?

A. I am in favor of patient's rights legislation within limits. But I don't think this decision was as important as one would conclude from the media's attention to it. What it did was reaffirm existing law. But because of the patient's bill of rights issue and some widely reported actions of H.M.O.'s in the past, the media have focused on it inordinately.

At the margin, the decision will give the legislation a push, but it's not at all clear that that push will be sufficient to put a bill on the president's desk. There are disagreements over the limits on liability that managed-care companies could face.

Also, other issues have pushed this one onto the back burner. There was a time when it looked like a patients' bill of rights could be a big issue in the upcoming elections. But now there are other issues on the front burners. Also, this issue is a very confusing one for many people.

Q. Aren't health insurers gradually losing their exemption from state regulation, even without a federal patients' rights law?

A. There has been a very gradual erosion, but we haven't gotten to the point where the erosion has become a slippery slope for the law. Personally, I'm a supporter of the Erisa exemptions. There are other avenues to insure adequate care besides the threat of lawsuits: competitive forces, oversight by employers or purchasers of the quality of care that they are offering employees. 
 

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ALL INFORMATION, DATA, AND MATERIAL CONTAINED, PRESENTED, OR PROVIDED HERE IS FOR GENERAL INFORMATION PURPOSES ONLY AND IS NOT TO BE CONSTRUED AS REFLECTING THE KNOWLEDGE OR OPINIONS OF THE PUBLISHER, AND IS NOT TO BE CONSTRUED OR INTENDED AS PROVIDING MEDICAL OR LEGAL ADVICE.  THE DECISION WHETHER OR NOT TO VACCINATE IS AN IMPORTANT AND COMPLEX ISSUE AND SHOULD BE MADE BY YOU, AND YOU ALONE, IN CONSULTATION WITH YOUR HEALTH CARE PROVIDER.