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of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto
Volume 59, No. 1 January 2003
SCIENTIA EST POTENTIA
This Latin motto-translated "knowledge is power"-is
displayed over the office of Admiral John Poindexter, Director of
the Information Awareness Office of the Defense Advanced Research
Projects Agency (DARPA), the agency that originally developed the
Internet (Wesley Pruden, Wash Times 11/22/02).
One of its databases is the Total Information Awareness
System (TIA). The goal is to link databases, such as those under
development by the Justice Department to catalog gun owners and
compile vehicle registrations, and integrate other data as from
credit card transactions, insurance applications, and electronic
tags for toll-road use.
"[S]uch a system...will allow someone to build a complete
dossier on virtually any person in seconds," stated computer
security expert Allen Eagleton (Capitol Hill Blue
The $200 million initial funding and authority to gather
this information without judicial protections is granted by the
USA Patriot Act, the Homeland Security Act-and the Health
Insurance Portability and Accountability Act or HIPAA.
The most controversial of the Orwellian items floated by the
current and former Administrations, a national ID card and the
Citizen Corps of spies known as TIPS (Terrorism Information and
Prevention System), were disavowed. However, a number of other
troublesome provisions were enacted as part of "must pass"
legislation that few Congressmen had an opportunity even to read,
much less debate.
Under the Homeland Security Act, Special Agents of the
Bureau of Alcohol, Tobacco, Firearms, and Explosives (BATF) have
the authority to make arrests without warrant for any
offense against the United States and to seize property subject
to forfeiture. Other Inspector General agents empowered to carry
firearms and make warrantless arrests include those of the
Departments of Education, HHS, HUD, and Transportation; AID;
FDIC; NASA; FEMA; the Small Business and Social Security
Administrations; and many more.
Meanwhile, government secrecy increases. The Homeland
Security Act creates an additional exemption to the Freedom of
Information Act (FOIA) for "critical infrastructure." In ongoing
cases, the Justice Department has filed a motion to place an
indefinite seal on evidence gathered in a Federal Vaccine Injury
Compensation Program proceeding to investigate a possible link
between vaccines and childhood autism. All original records and
documents used in identifying units and personnel immunized
during Operation Desert Storm are still classified (Joint Staff
Action Processing Form, Action #J-4A 01206-91).
Immunity and nonaccountability of government and its favored
private partners also expands. The Homeland Security Act makes
only the United States liable for adverse consequences of
"smallpox countermeasures," if and only if given as
deemed advisable by the Secretary of HHS, and if and only if the
"covered person...cooperate[s] in the processing and defense of a
claim." If the U.S. should pay a claim, it has the right to
recover the damages plus interest and litigation costs of actions
"resulting from the failure of any covered person to carry out
any obligation or responsibility" assumed under contract.
Past liabilities, as of Eli Lilly, are also wiped away by a
provision on pp. 482-484 of the Homeland Security Act-one for
which no one will claim responsibility. This defines as a
"vaccine" any ingredient (such as thimerosal) disclosed either on
the label or in the product license application for a
vaccine. About 800 pending claims could be dismissed.
In war, government is unconstrained by truth, even when
testifying under oath. For example, evasiveness and word games
characterized congressional testimony by generals defending the
Anthrax Vaccine Immunization Program (AVIP) (Heemstra TS,
Anthrax: A Deadly Shot in the Dark, 2002). In safety,
anthrax compared very favorably with other vaccines, they said.
A GAO survey, however, found an 86% rate of adverse reactions,
60% of which had not been reported to military personnel out of
fear of ridicule or loss of flight status (Chan, GAO-01-92T).
The "asymmetrical threat" of terrorism is the rationale for
"supersnoopers." And war is always a rationale for pervasive
government power: whether it's war on terrorists, drugs,
organized crime, tobacco, fraud, poverty-or ill health.
Germans now read in Der Spiegel Online
"wie die US-Regierung ein engeres Netz von Information aufbauen
will als die Stasi je hatte" (how the US regime intends to
construct a tighter net of information than Stasi [the East
German spy agency] ever had (Schwabe A, www.spiegel.de, 7/22/02).
Even if well-intentioned, the information net will fail to
achieve any useful purpose in medicine or economics, exactly
because of asymmetry: private, local information tends to be
highly useful; centralized, government information nearly useless
(Henderson DR, "What the Nobel Economists Missed," Wall
Street J 10/12/01). That is why central planning has always
led to chaos and widespread poverty.
Information overload and government secrecy will even impede
the apprehension of real criminals. An alert trucker captured the
D.C. sniper after information was strategically leaked from a
specific, limited, privacy-protected database-car license plate
numbers. In the meantime, the TIPS-like hot line was overwhelmed
with 70,000 false leads (CDT Policy Post 10/25/02). TIA will have
an inherent error rate orders of magnitude larger than the number
of terrorists in the world.
The federal government and corporate entities covet data
from TIA-especially from medical records: for "planning";
"quality" monitoring; and ferreting out noncompliance with rules,
such as vaccine mandates. All this knowledge will indeed give
them unprecedented asymmetric power over their subjects.
But it is truth that leads to freedom. And without freedom,
who can seek and find the truth?
"If government is responsible for healthcare, then unhealthy
behavior is a crime," is "an interesting statement today by a
Washington State law professor," posted to the
HealthBenefitsReform Yahoo discussion group on Dec. 7.
In 1999, the American Public Health Association asserted
that 48% of the determinants of disease were now due to
"behavioral lifestyle," 25% to genetic constitution, 16% to
environment, and 11% to lack of access to medical care. The
"great moments in public health" have evolved from sanitation in
the 1910s to polio vaccine in the 1950s to seat-belt laws in the
1980s and tobacco taxes in the 1990s. Visionaries predict:
"2020s: The U.S. conquers fat. Millions lose weight and regain
energy and vitality as as states pass fat taxes and levy fines on
overweight people" (Arizona Health Futures, Fall 2002).
Minnesota leads the way in collecting the necessary
information-for "research." The Health Department wants a
database to track every doctor or hospital visit, and an
administrative law judge ruled that the department has the power
to collect the data. Two attempts to repeal the enabling
legislation have failed. Twila Brase, R.N., of the Citizens'
Council on Health Care (
prepared to try again (Star Tribune 12/3/02).
Minimum Data Set (MDS)
The MDS for Nursing Home Resident Assessment and Care
Screening presented at the HHS Advisory Committee on Regulatory
Reform in March has 500 items. The highly paid professionals who
fill it out claim that it is responsible for great improvements
in the quality of nursing home care.
Michael S. Smith, M.D., of Tucson presented a form he used
successfully as director of a subacute/nursing facilty. It has 13
items, easily completed by minimally trained personnel.
Remember the Clinton Health Care Task Force
As AAPS pointed out when the bill was introduced, HIPAA was
imported almost word for word from the Clinton Plan. A key role
in the Task Force that drafted the plan was played by information
technology companies. Working Group 19 was called "Administrative
Proposals for a Bush version of a "health care overhaul"
were drafted by a Committee of the Institute of Medicine of the
National Academy of Sciences (see p. S1), four of whose 16
members were prominent participants in the Interdepartmental
Working Group led by Ira Magaziner (Robert Berenson, Karen Davis,
William Sage, and Marla Salmon)-see the Clinton Task Force
records posted on
As Uwe Reinhardt said, "I have been predicting that the
Republicans will try to steal the Democrats' thunder" (Waldholz
M, posted to HealthBenefitsReform 11/20/02).
It's the Process
Whatever you think of thimerosal, and even if Senators keep
their promise to repeal the "Lilly provision," the process that
turns Congress into a secret cabal is a clear and present danger
to the security of the Republic. During the bill-drafting
process, Washington's special-interest "alchemists work their
black magic to turn legislative gold into self-preserving lead"
Cut Medicare More, Doctor Urges
In a letter to Senators Boxer and Feinstein, Tom LaGrelius,
M.D., president of the California chapter of AAPS and the only
geriatrician in a city of 500,000, urged them to vote
against H.R. 5063, which would have increased Medicare
"Medicare, the second biggest Ponzi scheme in the world
(Social Security being the biggest) will bankrupt the U.S.
government sooner or later....
"Doctors who do not like the low fees Medicare pays have a
simple solution. They can quit! The more doctors who do that, the
better.... Already 20% have quit."
Dr. LaGrelius reports that his 93-year-old father is
delighted with the excellent care he receives from his opted-out
internist. Last year, he was seen often and hospitalized once.
The total physician's fees: $900.
Dr. LaGrelius is planning to opt out "before HIPAA
compliance becomes a bigger issue in April." Several of his
Medicare patients suggested the idea independently, and 8 out of
10 are willing, even eager, to see him opt out.
"The 65 to 85-year-old population is the richest demographic
subgroup in the country. Their care is paid for through a tax on
poor workers who will never see benefits after the Ponzi scheme
goes down. That is outright theft."
HIPAA Report from HHS
As reported at a Dec. 10 meeting of NCVHS, 550,000 HIPAA
extensions were filed. Estimated costs for compliance with the
transaction standards varied enormously: 11,000 estimated >$1
million; 8,000, $0.5-$1 million; 28,000, $100,000-$500,000; 111,-
000, $10,000-$100,000; 196,000, <$10,000; 189,000, unknown. HHS
was astonished that anyone would choose to be uncovered,
including a large oncology practice, which is returning to paper
claims. More public education will help people see the light, it
thinks; but it's having trouble explaining the regs at the
required sixth-grade reading level.
The AMA and its partner HIPAAdocs Corp. plan to profit from
the HIPAA regulations. They offer on-line compliance tools to
members for a "discounted" price of only $600 for a solo or two-
doctor practice, or up to $1,700 for ten or more doctors.
Nonmembers pay more.
Jan. 31, 2003. Board of Directors, San Antonio, TX.
Feb. 1, 2003. San Antonio mtg with Bexar County Med
Sept. 17-20, 2003. 60th annual mtg, Point Clear, AL.
Note date change to avoid conflict with Rosh
Oct. 13-16, 2004. 61st annual mtg, Portland, OR.
Replies Filed in HIPAA Privacy Rule Case
In its November reply to the AAPS appeal of AAPS,
Congressman Ron Paul, et al. v. U.S. Dept. of HHS, et al.
(No. 02-20792) to the Fifth Circuit Court of Appeals, U.S.
attorneys argue that the Fourth Amendment is not violated.
"[T]he only part of the Privacy Rule that affirmatively
mandates disclosure of a patient's private information" is
the enforcement provision requiring cooperation with an investi-
gation to determine compliance with the Rule [emphasis added]. A
physician might decide to honor a patient's request not
to release information for other purposes, except those required
by other laws-but is under no obligation to do so.
Moreover, argues the Department of Justice, even if a
hypothetical future search did violate the Fourth Amendment, the
only remedy would be the invalidation of the search at issue, not
overturning the Privacy Rule.
The AAPS reply brief contends that the Privacy Rule "exposes
personal medical records to broad mandatory and permissive
disclosures to government, without any meaningful safeguards
protecting their confidentiality."
The district court essentially ignores the Supreme Court
precedent in Whalen v. Roe, which found: "[T]he
Constitution puts limits not only on the type of information the
State may gather, but also on the means it may use to gather
it. The central storage and easy accessibility of
computerized [medical] data vastly increase the potential for
abuse of that information, and I am not prepared to say that
future developments will not demonstrate the necessity of some
curb on such technology."
The Privacy Rule commands essentially unlimited means.
AAPS also challenges the government's assertion that the
Regulatory Flexibility Act (RFA) is purely procedural.
The RFA "requires more than a perfunctory invocation to
justify the onerous new regulatory burdens." Small medical
practices have "no realistic way to comply...and remain in
business." As John Lumpkin, M.D., M.P.H., Chairman of the
National Committee on Vital and Health Statistics (NCVHS), to
Secretary Thompson: "[P]roviders may drop out of the system of
providing care to indigent patients because they cannot afford to
absorb the costs of complying with the Privacy Rule.... Millions
of health care workers will need to be trained in the next few
months, but there is a dire shortage of expertise, materials, and
Attempting to assert that paper records preserved in small
practices are in the "interstate stream of business" is "akin to
the Federal Communications Commission attempting to regulate all
actions of any individual who ever placed an interstate telephone
call," AAPS argues.
Briefs are posted at www.aapsonline.org .
AAPS thanks the American Health Legal Foundation for its support.
OCR Guidance on Privacy Rule
On Dec. 3, the Office of Civil Rights (OCR) posted 123 pages
of "guidance" at
www.hhs.gov/ocr/hipaa/privacy.html, to "communicate as
clearly as possible the privacy policies contained in the Privacy
Rule." The replies to the Frequently Asked Questions appear to
have been coordinated with the Dept. of Justice's responses to
the AAPS lawsuit. For example:
"Q: Does the HIPAA Privacy Rule require my doctor to send my
medical records to the government?" (p. 115)
"A: No.... This Rule does not require or allow any new
government access to medical information, with one exception: The
Rule does give ... (OCR) the authority to investigate complaints
that Privacy Rule protections or rights have been violated, and
otherwise to ensure that covered entities comply with the Rule."
The "Minimum Necessary Standard" does not
apply to "uses or disclosures required for compliance with
... (HIPAA) Administrative Simplification Rules" or disclosure
required by HHS for "enforcement purposes."
As Jim Pyles of the American Psychoanalytical Association
observes: "Whether such information is `pertinent' to compliance
is a determination that is solely within OCR's discretion. This
provision coupled with `regulatory permission' for covered
entities to obtain limitless amounts of personal health
information without consent would seem to provide the federal
government with unlimited access to the personal medical
information of every citizen.
"If the federal government wanted to obtain access to the
psychiatric records of a political adversary under this rule, it
... would merely need to conduct a `compliance' review of his
health insurer. Even the potential of such an action may be
enough to corrupt the political process."
AAPS Opposes Cert for CPT-Related Case
The ability of a private entity to lobby the government for
adoption of a set of standards, and then to profit from a
monopoly on writing the standards, is at issue in the case of Southern Building Code Congress
International v. Veeck (No. 02-355) (see AAPS
News July 2002). AAPS filed an
amicus brief opposing Supreme Court review of a 5th Circuit
The case has obvious application to the AMA's copyright on
CPT codes. The AAPS brief notes that "Ambiguities and perpetual
changes, which are obstacles to maximizing public compliance,
constitute a golden goose for monopolists who can sell
explanatory materials and seminars."
AAPS contends that free speech rights are violated when
legally required codes cannot be restated for public discussion.
The Court has held that "Government by secrecy is no less
destructive of democracy if it is carried on within agencies or
within private organizations serving agencies."
Of relevance is a letter from Andrea Cooper-Finkle, Office
of the General Counsel of the AMA, to the office of AAPS member
Wanda Velez-Ruiz, M.D. A letter from the AMA concerning a CPT
code interpretation had been submitted with a legal brief
appealing a workers' compensation determination.
"This letter," writes Ms. Cooper-Finkle, "contains at the
bottom of each page the following explicit language: `The CPT
coding information is being provided specifically to you based on
the facts and details you provided... Any reprint of all or part
of this correspondence, without the express written consent of
the American Medical Association, is strictly prohibited'
"The inclusion of [the AMA] letter in this Brief expressly
violates AMA policy.... We will not respond to your recent
letters in light of your violation of this policy."
Edgardo Perez-DeLeon, writing on behalf of Dr. Velez-Ruiz,
states: "Please alert the medical community to the conspiracy of
silence that the AMA has to let insurance companies [whimsically
refuse payment] for services honestly provided.... [W]e asked the
AMA how to bill ... according to the AMA's guidelines on the use
of the CPT codes,... [but] we cannot support the correct billing
with the AMA's opinion because it is secret" (correspondence
Sympathy, but No Dollars. The Chautauqua County Health
Network recently sent a letter requesting contributions to help
defray the cost of applying to CMS for designation as a "Primary
Health Professional Shortage Area (HPSA)," as grants had not been
adequate. I can't help observing the irony: the government helped
create the shortage via fixed fees that discriminate against
doctors who work in a rural area like Jamestown. Efforts at
"correction" would be comical were it not for the problems that
government price-fixing causes for patients. As some of the worst
famines in the world were created by governments that arrogantly
thought that they knew better than the free market how to set
prices, one must wonder whether these bureaucrats ever studied
any history or economics. While I can empathize with Project
Coordinator Stan Lundine's plea, expenses exceeding fees are
nothing new to practicing physicians. While adding 10% to
Medicare fees in the HPSA may help alleviate the shortage, I
don't think it would be proper to contribute to the contorted
dance of price-fixing followed by attempts at "corrections."
Lawrence R. Huntoon, M.D., Ph.D., Jamestown, NY
Price Controls. As an editorialist noted,
"Historically, price controls have had the same impact on the
economy that asteroids have had on the earth: The scale of their
damage is limited only by their size" (Washington Times
11/19/00). As Citizens Against Government Waste pointed out, in
American history the destructive impact of price controls has
ranged from abetting starvation at Valley Forge in the 1770s to
exacerbating the fuel crisis in the 1970s.
Craig Cantoni, Scottsdale, AZ
Government Creates Shortages. In medicine, we have
massive government intervention (Medicare, planning, insurance
regulations, licensure) and 42 million uninsured. In housing,
there is substantial intervention (mortgage interest deductions,
Section 8, public housing, zoning and building codes) and who
knows how many homeless. In food, there is less intervention
(price supports, FDA, food stamps) and only occasional hunger.
With clothing, there is no intervention and a surfeit, including
cheap, "after-market" clothes. Why is it better for a person to
be homeless than to live in a building that does not meet code,
or to be uninsured than to have a plan that does not cover mental
health or in-vitro fertilization?
Greg Scandlen, Frederick, MD
The Unique ID Number. Like HIPAA's privacy regulations,
which have nothing to do with privacy, the unique identifier has
nothing to do with assuring strangers that you are who you say
you are. The real goal of the unique identifier is to correlate
all the personal information of each citizen: educational,
financial, health, and labor history. Why would any agency desire
this information if not to control the citizenry?
Robert P. Gervais, M.D., Mesa, AZ
HIPAA Is Not Privacy. From a letter to the President,
American Academy of Family Practice: I realize there is little
you can do as the head of what used to be a very proactive
organization. Might I suggest that October FP Report
should not have a headline worrying about missing the deadline
for an extension to HIPAA when there is a simple way out of this
government chaos that bedevils our lives.... Please note the
absurdity of nailing steel doors to our files. HIPAA is not
privacy, but stupidity.... It merely builds the vast data base
that seems so dear to the heart of the bureaucrat.... Most of us
are ashamed that our medical societies are marching down the
incestuous pathway instead of joining the AAPS lawsuit.
Tad Lonergan, M.D., Desert Hot Springs, CA
The Result of HIPAA. The original proposed rules were
generated in response to very rare abuses by insurance
agencies releasing information. The rules generated a self-
serving bureaucracy and a new industry meant to regulate medical
practitioners who did not cause the abuses.... The
public is generally not aware that the privacy rules have nothing
to do with real privacy protection. The patients are still
signing away most of their privacy if they ask for third-party
N. Henry Pevsner, M.D., West Palm Beach, FL
Private Sector Must Work Together. [Each discipline
needs to address its own ills.] Otherwise, theorizing about the
other guy's ox will only assure that the government will
confiscate all oxen, declare them to have mad cow disease, and
destroy them all. Oxen will be replaced with a government-
designed mechanical ox with no flaws. It will not eat grass, it
will not work in the fields, it will not give milk, and it will
have no practical value, but it will not pollute, it will not
make noise, it will look nice and have no diseases: the perfect
Danny M. O'Grady, CLU, Midland, TX
The End of Regulation. Medicare creates a corps of
folks who make life miserable for doctors in the name of
protecting the public treasury. They add cost without value. More
doctors drop out, quality declines, and costs rise. The
bureaucracy's answer is to add more rules. Soon, the regulators
will outnumber the regulatees, the golden goose will be dead,
Lenin will get the last laugh, and we can all go back to growing
potatoes and herding goats.
excerpted from Frank Timmins, HealthBenefitsReform
Legislative AlertIt's 1993 Again
The National Academy of Sciences has come out with a
major report on the Health Care System, and it has Washington all
abuzz. It says that the system is in Crisis and listed the
standard catalogue of problems: double-digit cost increases, gaps
in insurance coverage, a rising number of the uninsured, medical
errors, and soaring medical liability insurance. The 16-member
NAS panel made a number of recommendations. According to veteran
health reporter Robert Pear, "The tone recalled the alarm and
urgency of President Bill Clinton in 1993 and 1994, but the panel
proposed a more modest agenda, using the states as laboratories
to attack 'disturbing trends' that have worsened in the last two
years" (NY Times 11/19/02).
Meanwhile, former Vice President Al Gore has reluctantly
concluded that the private health care system is not in the best
interest of the American people and has come out for a single-
payer system. On Nov. 14, ABC News Notes called Gore's
announcement "stunning." Said the ABC writers: "For Gore, this
represents a shocking switch. Although many of the people who
worked with Hillary Clinton and Ira Magaziner on the Clinton
Health Care Plan at the start of the Clinton/Gore Administration
were intellectually and morally sympathetic to single payer, it
was rejected as being simply too radical and too big a political
target." In other words, many of the Clinton team really believed
in their hearts and minds in an unvarnished socialist system. Oh
really, now. Somehow, we are less than stunned, shocked, or
bewildered than the gang at ABC.
Robert Pear is right: the calendar may say 2003, but, in
this respect, it's 1993-again. Let's learn from the past.
Six Big Rules for the Next Debate
In the fall of 1993, the Clinton Health Plan seemed to be
inevitable, and Congressional Republicans were initially reduced
to mumbling something about working with the White House. This
time, the political correlation of forces favors personal
freedom, patient choice, and free-market competition. But success
will depend upon the President and his allies offering credible
proposals for reform.
Rule #1: Realize that the Public is Pragmatic and Not
Ideological. The American political tradition,
epitomized by the Founding Fathers' work at the Philadelphia
Convention in 1789, is supremely pragmatic. We want liberty. We
want order. So we set up practical mechanisms to ensure both:
separate the different powers of government, establish a
complicated system of checks and balances, divide the legislature
into two houses, and force consensus and compromise in the
The American electorate is largely of the same traditional
mind and spirit. They see problems, and they want them solved.
The test of good government is whether the solutions work to
solve what they see as "their" public problems. Defining what
works always invites supremely practical questions: How much will
it cost me? Will "the solution" inconvenience me, or take away
anything that I have? The survey research shows this
overwhelmingly with respect to medical issues. If you ask whether
we should expand Medicaid to cover the uninsured, the voters will
say yes by large majorities. If the question is using tax credits
to cover the uninsured through private plans, or expanding
medical savings accounts, the answer is also probably yes by
healthy majorities. Unlike policy specialists, or folks on the
Left or Right with sincere philosophic convictions, voters are
not particularly obsessed with the way things are done,
so much as whether or not they are done to their satisfaction.
For policy wonks and their friends in Congress, this gets
tricky. According to a recent survey by Ayres, McHenry and
Associates, 81% of voters are very or somewhat satisfied with
their medical coverage. As most seem also to favor major reform,
in some vague way, they probably want reform that doesn't disturb
them and their relationship with their doctors or their private
plans. Likewise, the approval ratings for Medicare, among young
and old, are off the charts. But if you ask whether they know a
lot about Medicare, they will admit that they don't-by huge
Congress will certainly address the Medicare drug issue in
2003. In a November 2002 survey, Kaiser Family Foundation found
that 9 out of 10 American favor adding prescription drugs to
Medicare, but that this drops to a little more than 7 out of 10
when respondents are told that it will increase costs.
Traditional Medicare is preferred over private plans by 55 to
36%-a change from March when the ratio was 67 to 26%.
Republicans have an advantage going into the January 2003
session. In a post election USA Today/CNN/Gallup Poll
survey, 50% said that the Republicans have a "clear plan" for
curing the country's ills, while only 30% said the Democrats do.
Interestingly, 54% of the Democrats surveyed said that their
party needs to "moderate its liberal image." (That Democratic
majority sentiment did not, however, discourage 177 House
Democrats from bypassing Rep. Harold Ford (D-TN) and electing
Rep. Nancy Pelosi (D-CA) as House Minority Leader.)
On the Medicare prescription drug debate, syndicated
columnist Matt Miller observes: "When Bush pounds the podium for
a plan that harnesses the private sector and targets America's
neediest grandparents, it will sound entirely plausible, even as
Democrats cry that the plan was written by Big Pharma to
safeguard their evil price gouging. Whatever Democrats do-assent
to the GOP measure as a down-payment on a real plan or try to
block it-the GOP could score a big political win."
Rule #2: Know the Battlefield. The diverse
players include: professional medical and nursing associations;
trade associations for hospital officials, insurance executives,
research scientists and manufacturers with biomedical,
pharmaceutical, and medical technology companies; organizations
representing large and small employers; unions; public health
officials; and corporate benefits managers. Conflict among
private-sector players often degenerates into a form of political
cannibalism. But while private-sector players are often divided
against themselves, sometimes seeking government micro-management
of their competitors, the Left pursues a unified strategic
vision, enjoying the sweet advantage of not worrying about how
its legislative or regulatory initiatives impacts its profit
Congressional conservatives and their allies in the medical
profession and the private sector need to develop a strategic
vision based on the centrality of the patient-physician
relationship, patient choice, and free-market competition.
Congressional conservatives need to unite as a principled and
practical voice for free-market policies, playing the role of an
honest broker in the debates among the private-sector players,
even when principled positions are at variance with the short-
term interests of longstanding allies. Many physicians'
organizations, for example, view conservatives in Washington as
institutional allies. Nonetheless, during the multi-year debate
on the "patients' bill of rights," many of those conservatives
relentlessly criticized both House and Senate bills for expanding
the scope of litigation and federal regulation over the private
insurance market, even though the legislation has remained a top
priority of many of the leaders of organized medicine.
Rule #3: Don't Let the Perfect Be the Enemy of the
Good. A practitioner of the contemplative life should
strive for precise metaphysical distinctions and doctrinal
perfection. We, however, are engaged in public policy, in a life-
and-death struggle over the future of private medicine. This is
not the time for internecine conflict. Important and difficult-
but second-tier-issues include: details of "defined contribution"
plans; which deductible is best for Medical Savings Accounts; who
should finance reinsurance for bad risks; government rules for
guaranteed renewability versus guaranteed issue. Although most
ordinary folks would not care to follow these debates if we paid
them, they still somehow bring out the blood sports among
otherwise sane and sensible folks. Imagine the Allied Command in
World War II organizing a D-Day style landing on, say, Malta,
with heavy casualties, while ignoring the Nazi-occupied coast of
France. The best approach to such questions is empirical; let's
have demonstration programs to see which prescriptions work,
while expanding choice and competition.
Every battle that private-sector players have among
themselves constitutes de facto aid and comfort to the Left in
its relentless and persistent quest for socialized medicine.
Rule #4: Welcome Every Political Ally You Can Find,
Especially Prodigal Sons. Whether it is a leading
liberal intellectual at a prestigious university, a college
professor otherwise engaged in pushing some weird politically
correct agenda, or a moderate Republican or Democrat makes no
difference. Nobody has a monopoly on creative thinking. If a
person proposes something imaginative or innovative that will
advance personal freedom, patient choice, and free-market
competition, we should not say to ourselves, it's about time that
fellow saw the light! No, we should get out our poms-poms, do
handstands, rile up the crowd into an uncontrollable frenzy, and,
amidst a deafening roar, welcome him to the team and cheer him on
Rule #5: Get Ready for the Return of the Clinton
Plan. The Wisconsin State AFL-CIO has recently updated
its health care reform proposal. After cataloguing the problems
with the system, the union analysts noted that there are two ways
to control costs and build bargaining power for purchasers: a
single-payer system and an "employer-based unified system," which
they prefer. The elements should sound familiar: a new Commission
to set rules for all employer plans in the state; a common
comprehensive health benefits plan for all; financing through an
"employer-paid assessment for each employee" (in plain language,
a payroll tax), with the amount set by the Commission. In other
words, the Clinton Plan.
Various Clintonista apologists, well trained by Spin Central
during the 1990s, are trying to re-write history. Their message:
Clinton care was not as bad as we all thought it was.
Well, yes it was. The day after Clinton submitted a 1342-
page bill to Congress, an unnamed Clinton advisor admitted: "What
they did was to take the form of managed competition and filled
it up with content that looks a whole lot like a Canadian-style
government system" (Steven Pearlstein and Dana Priest, "In Scope
and Vision, Health Plan Defines Clinton Presidency," Wash
Post, 10/28/93, p. A-16). As the article notes, the Clinton
staffer, in a moment of precious honesty, was "deviating from the
official White House line." Exactly.
The Clinton Plan was not, strictly speaking, a "single-
payer" plan. It was a system of plans, organized into huge
geographically based managed-care networks, all under centralized
federal supervision. The medical benefits would have been
formally comprehensive and regulated in intricate detail, even
down to the number of shots Americans would get. It was
stunningly coercive, with numerous mandates, particularly on
employers, and "premium caps" on health plans. On January 12,
1994, the Clinton White House, in an act of supreme chutzpah,
said that these caps were not price controls. The Clinton Plan,
in fact, went further than price regulation: it proposed a global
budget for all medical spending, a key feature of "single-payer"
systems, as in Britain and Canada. Indeed, under the Clinton
Plan, the federal government would have had direct control over
almost every facet of the financing and delivery of medical
services, public and private, through a National Health Board,
requiring, according to Laura Tyson, a member of Clinton's
Council of Economic Advisers, an additional 50,000 bureaucrats.
Later independent analyses put that number closer to 100,000.
Let's get the crucial distinctions clear, between a "single-
payer" system, in which the government would control the
financing and delivery of all medical services, and the Clinton
"multi-payer" system, even more complicated, in which the federal
government would control the financing and delivery of all
medical services. After all, you don't want to be accused of
misrepresenting the former President's plan, just to score points
at the expense of the coming clones.
Rule #6: Conservative Sounding Rhetoric Will Often
Accompany Collectivist Policies. Consider the phrase
"competitive bidding." It has a free-market ring to it, but what
exactly does it mean? Setting prices on a competitive model? Or
DOD-style procurement? The government could use the purchasing
power of the state to secure big economies of scale. Who could be
against that? So why not expand this concept to food, clothing
and shelter? We could have all these things cheaper than we have
them today: uniforms, K-rations, and HUD-style housing. And the
taxpayers could save gobs of money as well. And isn't money what
it's all about?
Robert Moffit is a prominent Washington health policy
analyst and Director of Domestic Policy at the Heritage