Tucson Blvd. Suite 9
Tucson, AZ 85716-3450
Phone: (800) 635-1196
Hotline: (800) 419-4777
of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto
Volume 49, No. 11 November 1993
TIME TO DRAW THE LINE
In 1836, during a lull in the Mexican bombardment of the
Alamo, Colonel William Barret Travis drew a line in the sand with
his sword: ``Those prepared to give their lives in freedom's
cause, come over to me.''
Every man save one crossed the line.
Within the walls of the Christian mission-turned-fortress,
189 patriots, including David Crockett and the Tennessee Mounted
Volunteers, held off an army of 4000 for 12 days. Although he
knew defeat and death were inevitable, Travis answered General
Antonio Lopez de Santa Anna's surrender ultimatum with a cannon
Santa Anna had broken his promise of freedom to the
colonists in Texas and intended to establish himself as dictator.
On October 6-9, 1993, AAPS held its fiftieth annual meeting
at the Menger Hotel, next door to the Alamo, about two weeks
after President Clinton's message to a Joint Session of Congress
concerning his proposed Health Security Act. The 243-page draft
of the Act is basically very simple. It demands the forfeiture
of our freedom, and subjugation of patients and physicians to the
dictatorship of a National Health Board, in return for several
promises (called ``ethical foundations''). The promises,
translated into plain English, are as follows:
``Universal access'' to ``comprehensive
benefits'' means rationed access to-or even coerced
acceptance of-politically prescribed interventions, some of them
far removed from the care of the sick and the injured. (For
example, ``comprehensive health education'' in schools and
``control of indoor air pollution'' in homes have a high
``Choice'' means the selection of one of the
permitted alternatives. In the absence of freedom, ``choice'' can
ultimately mean Sophie's choice: which of our children (or
parents) will be killed (or at best allowed to die of a treatable
condition) in order to ``conserve limited resources.'' The
Clinton Plan would ``protect'' against medical bankruptcy by
forbidding citizens to spend their own money to obtain better,
potentially life-saving medical care. This restriction is
required to achieve the promise of ``equality of care.''
True equality of care is impossible in the real world
because of the wide differences among human beings, both patients
and physicians. The pursuit of this unachievable goal requires
the sacrifice of the rights to life, liberty, and property. The
Clinton Plan states that ``the system should avoid the creation
of a tiered system.'' The tiers are portrayed from the
perspective of the politics of envy-the ``poor'' versus the
``rich.'' In operation, the two tiers are a government system
based on bureaucrats' choices and a free-market system based on
individuals' choices. There is no debate about which is the
upper tier (now accessible to most via insurance or charity).
Just as the nation could not endure half slave, half free, a
socialized system cannot endure the coexistence of a free market.
The Clinton Plan would destroy private insurance and take private
medicine out of the reach of all but the most wealthy or most
By ``fair distribution of costs'' and ``personal
responsibility,'' the Clinton Plan means socialist
redistribution based on ability to pay. It would not be ``fair''
in this view to allow individuals to profit from their own thrift
Combining ``inter-generational justice'' and
``wise allocation of resources'' in practical terms means
deep cuts in Medicare. The ``shared sacrifice'' would fall
primarily on the old, along with others who lives are felt to be
As the Clinton Plan puts it, ``the nation should balance
prudently what it spends on health care against other important
national priorities.'' To each individual, his own life has a far
higher priority than free check-ups and cough syrup for the
masses of voters. Therefore, his wishes must be overridden;
there will be ``new criminal penalties for fraud related to ...
the payment of bribes or gratuities to influence the delivery of
health services and coverage.'' [Such ``informal'' payments are
common in Japan and the former Communist bloc.]
The details of the plan suggest that ``Health Security''
really means a number of other things, for example, Bankruptcy
Enhancement (the regional alliance would have a privileged claim
on a debtor's assets in the event of bankruptcy (which might be
caused by individual or employer mandates to pay for the health
plan). It is the Anti-Privacy Act because of the centralized
data bank created with the Health Security Card. It is the Small
Business Killer, the Bureaucrat Empowerment Act, the Medical
Specialist Unemployment Act, and the Medical Technology
Stagnation and Regression Act. It is the Legislature Obsoles-
cence Act because it would delegate any decision remotely related
to ``health'' to an independent agency.
Political pressures will probably cause the revision of the
most onerous provisions of the Act (which can always be added
back later, in the Budget Reconciliation Process, once the
machinery is in place). But the Act cannot be fixed. It must be
opposed on principle and wholly defeated. It legalizes the
functional equivalent of murder by depriving Americans of their
liberty to use their property to preserve or enhance their own
lives. No compromise with such ``ethics'' is possible.
On October 8, 1993, the Assembly of AAPS unanimously passed
a motion of unqualified opposition to the Clinton Plan because it
abridges personal freedom.
The Clintons could win despite our opposition. But they
should heed another historical lesson.
When congratulated on his costly victory, Santa Anna said
``it was but a small affair.'' Forty-six days later, fewer than
800 angered Texans won their war for independence, routing the
Mexican army at San Jacinto in a matter of minutes.
Remember the Alamo.
The Clinton Plan
Here are some highlights of the Clinton Health Care Reform
Plan, with page references to the 243-page ``leaked'' Working
Group draft document obtained by the Bureau of National Affairs
on September 10, 1993 [and with some translations or
clarifications in brackets-emphasis added]:
``It is the obligation of every eligible individual to
enroll in a health plan. Anyone who does not meet the
established deadline for enrollment automatically is enrolled in
a health plan when he or she seeks medical care'' (p. 15)
[Ineligible individuals are undocumented aliens.]
``Any individual not eligible for the national benefit
package may purchase coverage from a private insurance plan to
the extent such plans are available'' (p. 17).
``Consumer out-of-pocket costs for health services in the
comprehensive benefit package are limited, to ensure financial
protection'' (p. 34). [See article on p. 1.]
``Each Alliance includes among its health plan offerings at
least one plan organized around a fee-for-service system. A fee-
for-service system is one in which patients have the option of
consulting any health provider subject to reasonable require-
ments...[which] may include utilization review and prior approval
for certain services'' (p. 62). [The requirement to offer this
alternative may be waived. Payment would be on a fee schedule,
and all balance billing is banned.]
``States also may require all payers...to reimburse
essential community providers'' (p. 73) [Such providers will
include school-based clinics and designated entities in
underserved areas, also see pp. 184-185.]
``Health plans accept every eligible person....Health plans
may not terminate, restrict, or limit coverage...for any reason,
including nonpayment of premiums'' (p. 74). [No private insurer
could survive under these conditions.]
``Health plans in states that allow advance directives and
surrogate decision making related to medical treatment are
required to provide information about those legal options at the
time of enrollment in the plan'' (p. 76).
A Health plan is authorized to ``limit the number and type
of health care providers who participate in the health plan [and
to] require participants to obtain health services other than
emergency services from ... providers authorized by the health
plan'' (p. 76).
``State laws related to corporate practice of medicine and
to provider ownership of health plans or other providers do not
apply to arrangements between integrated health plans and their
participating providers'' (p. 77). [A health plan administrator
can make clinical decisions based on how much the plan has
exceeded the capitated amount for providing care, and the patient
has no legal recourse in the form of a malpractice suit.] Also,
health plans may ``use single-source suppliers for pharmacy,
medical equipment, and other health products and services'' (p.
77). [While the federal government is criminalizing previously
acceptable referral arrangements, this Act permits or requires
the formation of monopolies, as long as they are government-
approved or sponsored.]
``Once developed, only the model policies may be offered''
``Any health plan that sells duplicate coverage is dis-
qualified from participating in alliances. Any firm or
individual who offers such policies is subject to loss of the
license to sell insurance'' (p. 81). [Consumers will be forced
to put all their eggs in one basket. Extra insurance is
[Budget enforcement: If the weighted-average premium exceeds
its target, plans and providers are ``assessed'' (p. 98).]
``Tools to meet premium targets:....Limiting enrollment in
high-cost plans by freezing new enrollment....Setting rates for
health providers....Controlling health care investments through
planning'' (p. 98).
``[S]tate and federal inspection agencies audit the work
being done in hospitals, doctors' offices, and laboratories, and
penalize the providers if they fail to follow the rules. Patients
play a minor role, lacking reliable information....'' (p. 100).
``Health plans implement and maintain core discrete
electronic documentation of all clinical encounters....'' (p.
112). [Patients will have the right to approve use of these
``Major public and private payers...as well as clinics and
group practices of 20 or more professionals automate the core
transaction set within six months of adoption. States may deny
payment to plans that have not automated transactions by that
date'' (p. 119). [This is called ``simplicity.'']
The plan will ``reduce rates for office consultations to
equal office visits'' (p. 133).
The ``core public health functions'' of the plan include
``enforcement functions related to air pollution (including
indoor air),...handling and preparation of food, sewage and solid
waste disposal,...radon exposure, noise levels,...'' (p. 145)
[The plan is ``comprehensive.'']
``Fines, penalties, forfeitures, and damages...for fraud or
abuse in health care delivery are deposited in a trust fund to
supplement federal efforts to combat health care fraud and
abuse'' (p. 172).
The new health care fraud statute is to be modeled after
existing mail and bank fraud statutes. ``Current federal
authority is amended to allow forfeitures of proceeds derived
from health care fraud. The forfeiture remedy allows the federal
government to use either criminal or civil remedies to seize
assets derived from fraudulent or illegal activities'' (p. 173).
[Actions that constitute ``wrongdoing'' are listed on pp. 174-
179. They include ``unnecessary multiple admissions,'' ``failing
substantially to provide medically necessary services,'' and
``failing to report information or reporting inaccurate
information that is required to be submitted to a data bank.'']
``Rapid implementation...is vital. To expedite implementa-
tion, the National Health Board, the Department of Labor, and the
Dept of HHS are authorized to issue any regulations by the Act on
an interim and final basis'' (p. 217).
[On ``contributions,'' ``responsibility,'' and the
functional equivalent of a payroll tax for persons not on a
payroll:] ``Individuals who work less than a full year...are also
responsible for any unpaid employer share to the extent that they
have non-wage income'' (p. 221).
``Federal guidelines require that regional alliances
exercise due diligence in collecting unpaid employer and consumer
premium contributions, including the imposition of interest
charges and late fees for non-payment and other credit and
collection procedures. Premium contributions owed to regional
alliances are privileged compared to other corporate or personal
obligations in bankruptcy proceedings.
Alliances recover for unpaid premium contributions through a
premium assessment paid by employers and consumers'' (p. 237).
For a copy of the 243-page draft, send $12 plus a mailing
label to AAPS at 1601 N. Tucson Blvd. #9, Tucson, AZ 85716.
Constitutional Challenge to Kentucky ``Provider Tax''
Goes Forward; Court to Hear Oral Argument November 1
In July, AAPS member Stuart Yeoman, MD, and two other
physicians filed suit in Kentucky challenging the discriminatory
provider tax on physicians on a number of constitutional grounds
(see AAPS News Sept. 1993). The Court denied a request
for a temporary restraining order on the grounds that the
plaintiffs had not shown irreparable harm. All Kentucky
physicians and other medical providers could recover the amount
of taxes they have paid if and when the statutory scheme is
declared unconstitutional. The Court did expressly state that
the Plaintiffs have raised serious constitutional questions.
After the Franklin Circuit Court rendered its rulings on the
Plaintiffs' Motions for Class Certification and Temporary
Injunction, a group of approximately ten Kentucky Health
Maintenance Organizations (HMOs), which are also subject to the
tax, filed suit, followed by a number of hospitals and the
Kentucky Medical Association. The cases have effectively been
consolidated so that Plaintiffs may receive a prompt ruling.
Additionally, all parties have agreed that any appeal will be
taken directly to the Supreme Court of Kentucky, bypassing the
intermediate appellate court.
The Plaintiffs filed a Motion for Summary Judgment on
September 15, 1993. The brief discusses at length the separation
of powers guarantees of the Kentucky Constitution, arguing that
the legislature has extensively delegated its power to tax. [The
delegation of powers to a National Health Board under the Clinton
Plan will also raise this issue.]
The Kentucky Act [like the proposed Clinton Plan] empowers
the Kentucky Health Care Data Commission to audit health
providers and randomly invade physicians' offices and seize
medical records. This violates not only the Fourth Amendment's
prohibition against unlawful searches and seizures, but also
unconstitutionally invades the privacy of both patients and their
Oral arguments will be held in the Franklin Circuit Court on
November 1, 1993. The Plaintiffs hope to have a ruling on the
constitutionality of House Bill No. 1 by Thanksgiving.
The American Health Legal Foundation has agreed to support
this case to the extent that funds can be raised. Tax-deductible
contributions may be sent to AHLF/Warren County Constitutionality
Challenge, 1601 N. Tucson Blvd #9, Tucson AZ 85716.
Comments on the Clinton Plan and Its Genesis
Allan Routzahn, retailer, who has lost a third of his
stores in 18 months, said his company was too small for the
subsidy but not large enough to benefit from the spending cap.
``Small business cannot afford this plan....tripling my costs
will not work in today's economy.''
President Clinton to Mr. Routzahn: ``All I can say
to you, Sir, is that if we don't do something like this, then
everybody's going to be going in the same direction you are.''
Small business, he said, would have to be able to afford this
plan ``for its own good'' (AP 9/16/93).
Hillary Rodham Clinton: ``I can't go out and save
every undercapitalized entrepreneur in America'' (Wall St J
Rep. Dick Armey (R-TX): The Clinton Plan is the
``Dr. Kevorkian prescription for the jobs of American working men
and women.'' At hearings before the House, he promised to make
the debate ``as exciting as possible.''
``I'm sure you will do that,'' stated Ms. Clinton, ``you and
Dr. Kevorkian'' (AP 9/30/93).
Uwe Reinhardt of Princeton, consultant to Health Care
Task Force: The Clinton Plan ``implies considerable supervision
of doctors by lay people. That will divert income from people
who lay hands on people to people who supervise doctors'' (Wall
St J 9/13/93).
Lonnie Bristow, Chairman, AMA Board of Trustees:
``The AMA...welcomes the President's affirmation of many
principles the AMA first called for nearly four years ago.''
Vicente Navarro, MD, of Johns Hopkins University,
consultant to the Health Care Task Force: ``Cuba's quality-of-
life indicators...are better than those of comparable countries
in Latin America. These improvements in health are not merely a
result of better medical care but rather an outcome of
improvements in the socioeconomic conditions of the majority of
its citizenry'' (``Capitalism Has Not Won,'' Intl J Health Serv
Navarro: ``It is not possible...to save the truly
scientific liberating parts of medicine and its unsexist and
unracist components and throw out the rest. Medicine is a social
relation in contradiction, not an instrument that can be split in
different parts....Medicine is not an appendix of capitalism.
Medicine under capitalism is capitalism'' (``Radicalism, Marxism,
and Medicine,'' Med Anthropol 11:195-219, 1989-emphasis in
E. Richard Brown, consultant to the Health Care Task
Force: ``[T]here are alternate ways of controlling utilization
and costs....[t]riage by nurse practitioners, primary care case
management, queuing for nonurgent care, and budgetary control''
(``Principles for a National Health Program: a Framework for
Analysis and Development,'' Milbank Quarterly 66:573-617).
Richard Kronick, consultant to the Health Care Task
Force: ``A strategy of `interim' federally imposed all-payer
price controls would, in my view, be a mistake. It would not
achieve much more by way of price controls than can be achieved
through HIPC implementation....There is not a big time difference
between the date on which we could start regulating health plan
premiums and the date on which we could start regulating unit
physician and hospital prices'' (Health Affairs Supplement 1993,
David M Eddy, consultant to the Health Care Task
Force: ``A `minimal level of adequate care' consists...of access
to more individualized forms of cure compatible with a sensible
allocation of resources to the health sector in relationship to
other societal requirements'' [emphasis added]....``[P]olicies
that will affect millions of people and billions of dollars would
be based on the value judgments of a very small number of
people....[T]his approach can be applied piecemeal-one
intervention at a time-...without any major commitment to
legislative change'' (JAMA 265:786-788, 1991).
Judith Feder, Director of Health Policy, Transition
Team, ``You can't control only a part of this system; you've got
to control the whole thing'' (AAPS News March 1993).
AAPS welcomes Drs. David A. Birnbaum of Hoffman Estates, IL;
Edward L. Mosley of Fairmount Heights, MD; Arnold J. Weil of
Marietta, GA; Jon Johnston of Marina Del Rey, CA; Gregory J.
Martonick of Walla Walla, WA; William B. Jackson of Tacoma, WA;
Samuel Medrano of Sacramento, CA; John D. Stewart of Tacoma, WA;
Howard Jay Hassell of San Antonio, TX; Arthur J. Ozolin of
Tacoma, WA; Stewart D. Cole of Sunnyside, WA; Norman Stirling of
Marina del Rey, CA; Dennis Carter of Boise, ID; Edward Kauffman
of Bellingham, WA; Samuel E. Adams of Tacoma, WA; Tom Cadenhead
of Denton, TX; Rosemary Crawford of Kent, WA; Gary J. Dellerson
of Lake Worth, FL; Peter M. Doloni of Sharon, PA; W.C. Douglass
of Atlanta, GA; Kenneth Edstrom of Puyallup, WA; Bernard E. Engel
of Westminster, CO; Arthur Ginsberg of Seattle, WA; Mildred F.
Jefferson of Boston, MA; Andrew Kant of Houston, TX; Harold J.
Kornylak of Virginia Beach, VA; Frederick C. Kriss of Cross
Plains, WI; L. Gerald Laufer of New York, NY; John Margaris of
Great Falls, MT; Douwe Rienstra of Port Townsend, WA; Dennis
Scharfenberger of Warwick, NY; Reuben Setliff of North Platte,
NE; Wayne Smith of Heber Springs, AR; William K. Summers of Albu-
querque, NM; D. W. Williamson of Tacoma, WA; James Wood of
Temple, TX; and Vern S. Cherewatenko of Renton, WA.
New student members are Thomas F. Lee of Columbus, OH;
Lawrence Goodstein of Lynbrook, NY; Tamara I. Buell of Columbus,
OH; C. Randy Speights of Houston, TX; David Roger Witt II of
Houston, TX; Deirdre McMullen of Houston, TX; Habib Emami of
Brooklyn, NY; Stephen Fraser of Milwaukee, WI; and Denise C.
Hossinger of Houston, TX.
Uninsured by Choice
Like millions of other Americans, my wife and I chose to
insure ourselves, paying bills with funds saved and invested that
did not go to insurance premiums to pay for an immense health
insurance bureaucracy. To be sure, we were accepting the risk
that we might be wiped out financially by catastrophic illness.
But if an insurance company can accept such a risk, why can't you
or I? If my wife or I fell gravely ill, we would not lack
medical care. Our doctors would treat us, and we would pay what
we could afford. If needed, we would become medical indigents
and declare medical bankruptcy, with none of the stigma attached
to personal bankruptcy. Would we have been better off financially
with insurance? Certainly not. Every cent would have gone for
medical care rather than a medically useless bureaucracy....
Lawrence Cranberg, PhD, Consulting Physicist, Austin, TX
Nov. 6-7. Medical Action Committee for Education, Philadel phia
(call Dr. Jerome Arnett, (304)636-8416).
Nov. 13. Health Care Reform: Implications for Patients,
Practice, and Progress, Cambridge Center Marriott, Cambridge, MA,
sponsored by Beacon Hill Institute at Suffolk University and
M.A.C.E. Speakers include AMA President-Elect Robert MacAfee;
John Goodman of NCPA; Peter Ferrara of Heritage; Stephen Cohen of
Physicians Who Care; Nick Gettas of Canada; and Jeffrey Flier of
Harvard. For further information, call Dr. Robert Sylvester,
Oct. 12-15, 1994, 51st annual meeting, Atlanta.