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Volume 50, No. 11 November 1994

Task Force Documents Give Glimpse of Inner Circle

``What we are doing is far more significant than Medicare/Medicaid. We'll be setting in place the health care system for the next generations.'' stated a Task Force Working Group member in handwritten notes from a secret meeting.

More than a year after the President's Health Care Task Force officially disbanded, those able to go to the National Archives II in College Park, MD, can get a glimpse into the process that intended to bring about a ``radical restructuring of the health care system with major shifts in power and responsibility, under the auspices of the federal government.''

A participant who managed to win a coveted spot on the Task Force, though but recently graduated from college, told of ``wonking till the wee hours'' in a ``finals like'' atmosphere, under the pressure of tollgates.

Members were admonished not to talk to the press, and not even to tell what groups they were working with.

During the process, the public and the press were given no inkling of the serious misgivings of some Task Force members. ``A consensus is forming,'' stated Ira Magaziner.

That was a ``euphemism,'' according to James Ukockis of the Treasury Department. Concerning the short-term cost controls, ``every option has fatal flaws,'' he said. For example, if Medicare price limits were expanded to all, Ukockis predicted ``financial havoc.'' Premium regulation, a policy that ``looks favorably upon the prospective forced exit of many companies from the health insurance field,'' would destroy incentives to invest.

``With both timid and aggressive investors excusing themselves, we are left with only crazy investors, which brings us to the government,'' said Ukockis. He spoke also of dim prospects for investment in drugs, equipment, and training for physicians and other medical personnel.

AAPS researchers have uncovered no evidence that anyone bothered to refute the naysayers. Perhaps they were simply ignored. Perhaps they had some influence in that the Clinton Plan did not include such Draconian proposals as the ``shock treatment.'' For physicians, a 100% federal tax was proposed on income exceeding prescribed limits. It was to be enforced by withholding 15 to 20% of gross revenue, refundable only by submitting an independent auditor's statement of full compliance. The burden of proof was to be wholly on the provider.

Certain ideas of the Working Groups will be back next year, even though reform was defeated in this session of Congress. Perhaps most important is the establishment of a central computerized data base, in the name of ``accountability,'' ``administrative simplification,'' ``paperwork reduction,'' and ``quality assurance.''

``In an effort to catch the cheaters, privacy is put at risk,'' stated one Working Group member. It is not only ``providers'' who need to be caught responding to the incentives created by federal money; ``abusers'' and ``chronics'' must also be tracked by means of personal identifiers.

Despite the cost-containment concerns, ``administrative streamlining is not the key to savings,'' said one Task Force member. In fact, ``Ira's convinced that computerization in business has added cost.''

Not just administrative data, but patient-care data, in standardized format, are a high priority. ``Simplification should not mean data poor-more information should result as automation increases.'' One purpose of the information infrastructure is to ``provide a report card to the government.''

``It seems to me,'' wrote one participant, ``that we should use exactly the same data that the providers need/depend on-that way, the providers cannot cheat, or they will screw themselves [sic.].''

Many private vendors of hardware and software were intensely interested in the Task Force and the opportunity to profit from ``this unique window in history for developing the health information infrastructure.''

After being immersed in boxes full of the drafts, memoranda, lists, notes, personal journals, and scrap paper of this remarkable committee, an observer may feel overpowered by the hubris. The elite thousand, driving themselves through dawn-to- midnight meetings, were apparently quite serious about their mission to destroy and resurrect a one-trillion dollar enterprise affecting 260,000,000 human beings.

The revelations of some possibly embarrassing notes have been made for one purpose: to have the case of AAPS v. Clinton thrown out of court on the grounds of mootness. The Department of Justice asserts that ``plaintiffs now have access to far more material than they would have been entitled to had they prevailed on their FACA [Federal Advisory Committee Act] claim.''

The White House has not admitted to violating the open- meetings law, which requires public notice and participation, with contemporaneous availability of documents. Nor has it provided full disclosure of conflicts of interest, or information regarding Task Force expenditures and sources of funding. There is no index provided for the material, though one document refers to its preparation.

AAPS is asking the court to rule that the White House violated the Federal Advisory Committee Act. In addition, a motion is pending for sanctions against Ira Magaziner for submitting a false affidavit.

Judge Lamberth of the US District Court for the District of Columbia denied a government motion for an expedited ruling on the contempt allegation against Magaziner.

Oral arguments on the mootness issue is scheduled for October 13. The outcome is not known as this newsletter goes to press.

From 1949 to 1994

``President Truman's special message, asking enactment of a national compulsory health insurance program, deserves most careful scrutiny by Congress and by the American people, whose health would be seriously endangered if this Old World scourge is allowed to spread to our New World.

``There is neither hope nor promise of progress in this system of regimented medical care. It is the discredited system of decadent nations....It is one of the final, irrevocable steps toward state socialism....

``The President's message, in some respects, was persuasive and disarming. The ideals and objectives were stated in glowing terms, but the message was completely lacking in any specific statement of the services to which the people would be entitled, or any estimate of the taxes which they would be compelled to pay....

``The voluntary way is the American way'' (statement of Dr. Elmer L. Henderson, Chairman of the AMA Board of Trustees, JAMA 140:114, May 7, 1949).

``As the President [Clinton] has said, it will take sacrifice and shared responsibility by all of us, including physicians and patients....[A] true and focused partnership will have to be formed between physicians and government....'' (``Proposal for Using Negotiations and the Medical Profession's Infrastructure to Control Costs, Disseminate Information and Bring About Change'' submitted to the President's Task Force on National Health Care Reform by the AMA)

``The AMA believes the status quo must go'' (James Todd, M.D., Executive Vice President, in a March 3, 1993 cover letter accompanying the proposal).


Community Rating: Increasing the Uninsured

A major feature of many ``reform'' proposals is to forbid insurers to price risk.

Promising to improve the ``quality, affordability, and accessibility'' of health care for all New Yorkers, New York State mandated ``community rating'' in 1992. NY Legislative Act 12350 requires open enrollment, at the same premium regardless of age, sex, or health status, for all small group and individual policies. The act also outlawed self insurance by trade and professional associations.

After one year, 43,666 people cancelled their medical insurance, and several major insurers (Prudential, State Farm, and Aetna), along with many smaller firms, left the state.

Community rating overcharges young, healthy subscribers. For 30-year-old men, premiums nearly tripled in New York, and the price of insurance for a 30-year-old with a family increased by more than $3,000, or by 90 percent (Citizens for a Sound Economy Foundation, 8/15/94).

Community rating also forces those who adopt traditional family values to pay substantially more so that those who follow a high-risk life-style can pay less (National Center for Policy Analysis Backgrounder # 132, 8/10/94).


Updates from Canada

Administrative Overhead. In 1990, Canada's 1,101 hospitals had 143,000 administrative support personnel in a total of 464,000 employees. Each province has a huge computer system to track payment of every bill to every provider. In British Columbia, physicians produce 150 million separate billings every year, mostly for less than $40.

To reduce bureaucratic overhead and to empower patients who are spending their own money, Bill W. Weaver, M.D., has proposed a Medisave plan for Canada. His plan is modeled on the system in Singapore, where medical expenditures constituted 3.2 percent of the GNP in 1988 compared with 6 percent for Canada (For details, write Dr. Weaver, Suite 814 - 750 W. Broadway, Vancouver, B.C. V5Z 1H7).

Waiting Lists. In British Columbia, 0.9 percent of the population is on a waiting list for surgery, according to a survey by the Fraser Institute (626 Bute St., Vancouver, B.C. V6E 3M1). About one-fourth of the cases are classified as ``urgent.'' Before reaching the surgery waiting list, patients must also wait about four weeks for an appointment with a specialist. In some instances, waiting times appear shorter because patients in some provinces are simply not referred for MRI or hip replacement.

Freedom. On June 19, 1986, the Ontario provincial government passed Bill 94, which made it a felony, subject to prison or a $10,000 fine, if a doctor billed a patient directly or accepted anything more in payment for his services than the government allowed.

In July, 1994, citizens of Toronto were arrested for carrying a copy of the Buffalo News, which contained information about a trial that the government did not wish them to read. Television screens went blank after the station broadcast 10 seconds of news about the trial in contravention of a ban. A high-pitched whistle was broadcast instead of the rest of the news. Canadians who cross the border to get a haircut or a tune-up on their car are prosecuted for evading the 7 percent tax on these services (Detroit Free Press).


Anti-Free Speech Bill Defeated

Congress and the press called its target the ``Lobbyist Lunch.'' That is how it started out, but something got inserted in the Conference Committee without being voted on by either house. (This was one reason for opposing all ``health-care reform'' measures. Any bill that passed could have emerged from conference as the Clinton Plan.) The bill introduced extensive new reporting requirements for organizations that engage in ``grassroots lobbying'' or that simply inform their members about issues and encourage them to contact their Congressman. Organizations might have been required to divulge their membership lists to a government agency reporting to the President.

A remarkable coalition of associations ranging from the Christian Coalition to the Feminist Majority activated their FAX networks, calling the bill a ``gag rule'' or ``Hillary's revenge.'' At first assured of passage, the bill failed to obtain the required two-thirds majority in the Senate. (If you would like to be added to the AAPS FAX network, please send us your FAX number-remember, your machine has to know how to answer the phone automatically.)

All Europe adopted the Soviet attitude....Instead of governments supported by-and limited by-the people, the people would be supported by-and limited by-the government.
Otto Scott, Chalcedon Report, May 1994

How About Legal Reform?

As current trends in medicine, augmented by so-called ``health-care reform,'' tend to circumscribe the traditional role of the physician, trends in the law are in the opposite direction. The plaintiff's bar is expanding its never-ending battle for truth and justice into a new, massive War on Crime. The result: an epidemic of huge monetary awards against owners of premises on which violent criminal acts are perpetrated against patrons. Forty percent of the award goes to the lawyers.

Writing in the (Miami) Herald (4/10/94), attorney Thomas R. Spencer, Jr., stated that it's time for a ``monster wake-up call.''

``We now have less than five percent of the world's population and more than 75 percent of the lawyers. By those statistics, a distant observer could conclude that this society is the model of law and order. In fact, the opposite is true. Each day the explosion in crime against property and the avalanche of mindless regulations from administrative agencies...pile more and more expense on the product of our collective energy.''

The combined costs of crime, civil liability, and admini- strative regulatory games are destroying the American dream. We need a real legal revolution, but without throwing out the Bill of Rights. ``It will take a massive effort akin to the Manhattan Project,'' Spencer wrote.

``Laymen will have to direct the effort because we will need to apply radical surgery to a judiciary that is arrogant, defensive, and unresponsive to the urgent needs'' of a productive, free-enterprise society.

``We will have to reverse and repeal 30 years of ridiculous bureaucracy and begin to burn the red tape that is wrapping up our businessmen and producers. We will need to retrain a good percentage of our nation's lawyers (bright and talented people) to produce something useful....''

[Thomas Spencer is representing AAPS in the case of AAPS v. Clinton.]


Legal Briefs

Beware of Surveys from the Inspector General. The IG's office recently sent a 13-page survey to about 1,000 home-health providers, allegedly to be used in the development of new policy. Attorneys warn that such surveys can really be a ``fishing expedition'' for potential violations. For example, one question is: ``Do you believe it is appropriate for a physician who has not personally seen the patient to sign the plan of care?'' This practice will be the subject of a fraud alert.

Return of such surveys is often not required. They are coded so the IG knows who sent the survey even if returned anonymously (Medicare Compliance Alert 9/12/94).

Mandatory Medicare and Medicaid Exclusions Upheld. A review of decisions by Administrative Law Judges in appeals of mandatory exclusions shows the following: (1) The ALJ has no power to modify or reduce an exclusion imposed by the Inspector General. The state court system is the only proper forum for collaterally attacking a conviction. (2) The fact of conviction triggers the exclusion, and a guilty or no-contest plea constitutes a conviction, even if the charge is misdemeanor and the record is expunged. There is no need to prove criminal intent. (3) For purposes of mandatory exclusion, the Act makes no distinctions relating to the number of convictions. One (probably inadvertent) unlawful act in 20 years triggered a five- year exclusion for a supplier of medical equipment. (4) Cooperation with authorities is not a mitigating factor unless the party provides actual evidence that leads to the conviction of other parties (Civil Money Penalties Reporter 9/94).

Software May Be a Medical Device. The FDA now requires registration and approval of software products used by blood establishments to prevent the release of unsuitable blood components, unless the device was distributed before May 28, 1976, and has undergone no significant change since then (BNA's Health Care Policy Report 9/12/94).

Deselected Physicians Ordered to Pay Aetna's Costs. The US District dismissed a case that sought to prevent Aetna from dropping five physicians from its PPO network (Texas Medical Assoc. v Aetna Life Insurance Co., DC STexas, No. 94-0288, 8/24/94). Plaintiffs claimed they were denied due process rights granted by the Texas Administrative Code. The TMA argued that Aetna's action put pressure on physicians to make decisions based on economic factors rather than the best interests of their patients. The court ruled that only the Texas Dept. of Insurance could enforce its rules, and ordered the TMA, the Harris County Medical Society, and the five physicians to pay all of Aetna's costs (BNA HCPR 9/19/94).


The Patient : Bureaucrat Ratio

``My calculations show that, if present trends continue, by the year 2026 there will be 2.5 million administrators in U.S. hospitals and no patients at all'' (Victoria Sweet, M.D., N Engl J Med 329:1655, 1993, reprinted with permission).


Implications of ERISA Waivers

Several states, including Washington, are asking for waivers of the Employee Retirement Income Security Act of 1974. ERISA provides that individual states may not intervene in compensation and benefit agreements between employers and employees. This means that large multistate employers, who are typically self- insured, are not subject to state mandatory benefits laws. If Washington State fails to get a waiver, the impact of the Health Services Act will fall disproportionately on small business, ``getting their attention in a very substantial way,'' stated AAPS Director Michael Schlitt, M.D., who opposes the waiver. It would also move the state closer to a single-payer system, which is not popular in Washington, and could lead to repeal of the Act. (The Act provides for single or limited-sponsor plans if the ERISA waiver fails.)

Members' Page

Medical Students' Futures: The signs and symptoms of the future equal servitude to the state....Current legislation will decide tomorrow's life-and-death situations, and we the medical students will be the ones whose souls must live with the consequences. Our freedom to choose the best treatment for our patients will be replaced by protocols that may or may not be suitable. We must remember that lab rats are used for a reason. Americans must not be used for a price. The freedom of choice must continue to define us as Americans and as America's future physicians.

I hope that the student sector of AAPS will become a vibrant voice for our future. Beginning a student chapter is easy; call AAPS for guidelines. I started a chapter in Houston and was able to find sponsors (private practice physicians and small business owners). You might be able to obtain school financing, but be aware of the stipulations that government money may place on your freedom to assemble.
Liza Leal Barton, MS III National Chairman, Student Chapters of AAPS


``Paperwork Reduction'' May Mean Privacy Reduction: As tempting as the perceived ease of electronic transfer of medical billing and information seems, such procedure, if compelled, holds inherent dangers for both patients and physicians.

Problems will occur in obtaining and maintaining proof of accurate receipt and submission of data; errors in billing and in payment will be much more difficult to detect and correct. The legal ramifications of electronic evidence and its admissibility in court must be explored: a new body of law may be required.

Computers currently print forms for billing or insurance submission with a touch of a button-an effort no more labor- intensive than an electronic transfer. Such printed forms provide the safety of a paper trail to provide an accurate record of billings and services.

Government-provided software may well command the computer to transfer information specifically not intended for government scrutiny. Thus privacy is threatened. Access to patient records will be demanded for audit of accuracy of electronic billing, a demand already incorporated into the Medicare program's electronic transmission program.

The right answer for simplification and real paperwork reduction is to return responsibility for most routine care to the patients in a direct contractual relationship with their physicians. This answer is incorporated in medical savings accounts combined with high-deductible (and therefore infrequently used) catastrophic insurance policies. Interaction with third parties is therefore minimized.

Returning responsibility to the patient is necessary to preserve privacy.
Lois Copeland, M.D., AAPS President-Elect


The Anti-Trust Side Show: The Georgia ballot will have an antitrust initiative sponsored by physicians, who have been stripped of their traditional role as decision makers by managed care. It would allow physicians to band together to form essential insurance companies. A better solution is to equalize the tax deductibility of all medical care. This would allow workers to exclude employers from the medical care loop without a tax penalty. If employers did not provide our medical care, there would be no managed care.
Bert A. Loftman, M.D., Atlanta, GA

Legislative Alert

How the End Came - for This Year

When Senate Majority Leader George Mitchell announced that he was not going to pursue health-care reform in the 103rd Congress, many Americans and many Members of Congress breathed a deep sigh of relief.

Perhaps more important was the previous speech by Senator Daniel Patrick Moynihan (D-NY), Chairman of the powerful Senate Finance Committee, delivered almost two weeks before Mitchell formally threw in the towel. Moynihan's speech stunned Mitchell, Chafee, and his Senate colleagues with a simple message on health care reform: Just Stop It. Forget even ``incremental reform.'' Senator Moynihan proved to be the most important contributor to the continuing Senate seminar on the topic: Do We Know What We Are Doing? Newsweek's economist, Robert J. Samuelson, called for a halt last August: basically on the grounds that Members of Congress clearly do not know what they are doing.

As reported in the Washington Post (9/16/94), Moynihan said a close examination of the ``Mainstream Coalition Proposal'' revealed that it would be a step backward for many states. Like the Clinton clones, it contained a government- standardized benefits package, a powerful new federal health commission, insurance underwriting that amounts to community rating, new taxes and cuts in Medicare and Medicaid. Moynihan argued that there is an ``unbridgeable gap'' between what Congress wants and the means to pay for it.

The Mainstream Proposal was not published in legislative language, and Congressional staff had to go into a room and sign in, in order to look at the legislative language available. How about that for keeping the cards close to the vest? What the Congressional staff carrying water for government-managed medicine now realize is that any detailed piece of legislation incurs the danger of opposition based precisely on the details.

The latest problem to surface in the ``health-care reform'' debate: the kind of subsidies that would be available to low- income people. The Congressional Budget Office found the mechanics of the Mitchell Plan to be simply unworkable. Robert Reischauer, Director of the CBO, served as the most effective naysayer in Washington. ``This is an era in which Reischauer's cold-turkey reviews fit neatly into Congress's latter-day obsession with budget deficits, promoted by Bill Clinton, who (with some prodding from Ross Perot) made budget reduction his top legislative priority in 1993,'' wrote Hobart Rowen in the Washington Post (8/25/94).

Perhaps the most prestigious intervention into the Congressional mess was that of Joseph A. Califano Jr., President Carter's Secretary of HHS. Califano's prescriptions for reform are hardly conservative, but his analysis of the current process could have been ghosted by Senator Phil Gramm (R-TX). Writing in the Washington Post (8/18/94), Califano warned: ``Opportunities for mischief abound in the feeding frenzy of special interests as they circle several thousand pages of fine print in bills no Member of Congress has read or fully understands.''

Never has the best of American medicine been in such peril. Writing on ``cost-containment'' efforts pushed by liberals in Congress, Califano is downright contemptuous: ``The chutzpah cost-containment award goes to those Members of Congress who seek to cap physician pay, even though it saves almost no money. The average general practitioner makes about $155,000 per year; a quarter earn less than $75,000. The pay of the House or Senate easily tops $200,000-nearly double the income of the average family doctor. The base pay of a senator or representative is $133,600; the value of a typical pension is $60,000 a year, and family health coverage is worth $10,000 annually. Benefits such as airport parking, tax deductions for maintaining home state and D.C. residences, and subsidized gyms and haircuts easily add another $5000. How do members of Congress think voters would answer the question, `Who is worth more to you, your family physician or your senator or representative?' '' The outlook: ``Congress will be legislating reforms for at least the next decade, as it ...adjusts for the unintended consequences of prior reforms and fights the continuing battle with costs.''

Senate Minority Leader Dole had been holding out the idea of yet another Congressional leadership bill, something crafted by the four party leaders of the House and Senate, with each given veto power over whether the package should go to the floor. But the idea also quickly died. Neither Mitchell nor Foley showed much interest. Meanwhile, the shift in the power of Congressional staff had gone from Sheila Burke, Dole's top health care advisor, to Christie Ferguson, Chafee's top health care specialist. Because Mitchell had entered into negotiations with Chafee, all Congressional staff eyes were also focused on the role of Christine Williams, Mitchell's health care chief. The shift in staff power and influence in the process is decidedly to the left.

Time for Recrimination

In the closing days of the Senate debate, before Mitchell mercifully pulled the plug, First Lady Hillary Rodham Clinton seemed to take a low profile. Recently, she told the New York Times (10/3/94) that she would be willing to take ``some'' of the blame for the death of ``health-care reform'' this year because she failed to gauge the intensity of opposition to the White House Plan, the barrage of advertisements against it, and the misunderstanding on the part of opponents that the plan was to be the basis for negotiations. Could have fooled us!

In the Clinton White House, one has to be Politically Correct. And the Politically Correct reason for the failure of health care reform will be...? Prediction: Ira Magaziner will be tagged as the Fall Guy. He was responsible for the Plan's complexity; its gargantuan scope; its Rube Goldberg-like style. Meantime, continuing the slide in approval ratings, News- week's survey of September 29-30 finds that only 36 percent of Americans favor the way President Clinton is doing his job, while 48 percent disapprove.

Because Political Correctness includes a ``holistic approach'' to blame, look for the Politically Correct to assign a major portion of The Blame to greed, Harry and Louise, narrow special interests, etc. If only the American people really understood the Clinton Plan, they would have flocked to its support, backing every title and subtitle, every section and subsection, but they were blocked from forming an independent judgment on the matter by the opponents of Reform.

There are other candidates for blame. John Motley, chief lobbyist for the National Federation of Independent Business, credits the Congressional Left; they torqued every variant of legislation in a bureaucratic direction, making sure that the end result would have been a government-run health-care system. Bill Kristol, Chairman of the Project for a Republican Future, also attributes the defeat of the Clinton Plan and its variants to a classic case of Liberalism overreaching. The Clinton Plan was the political equivalent of Liberalism's invasion of Russia; it was bound to fail.

House Majority Leader Richard Gephardt has an even simpler explanation: The Republicans did it. Ditto Ted Kennedy.

Ira Magaziner blames The Special Interests (not to be confused with groups representing ``The Public Interest'' (AARP, Families USA, the AFL-CIO, etc.), who frightened the public with scare stories about bureaucracies and denial of choice of a doctor. Ditto: Congressman Jim McDermott and Senator Paul Wellstone.

Dr. P. John Seward of the AMA thinks that ``complexity'' killed ``reform.'' Ditto Bob Dole.

Perhaps the most interesting view is that of Paul Ellwood M.D., one of the champions of ``managed competition'' and the leader of the Jackson Hole Group: ``Genuine health-care reform'' was killed in the White House, when the forces of ``pure managed competition'' were overwhelmed by the Central Planners. Earlier in the debate, Ellwood denounced the Task Force for issuing a product that looked more like a reincarnation of Soviet central planning.

Consider a better explanation of it all. The impressive Clinton rhetoric about ``choice,'' ``competition,'' ``free markets'' and ``simplicity'' into the system had nothing to do with the actual language of the Clinton Proposal. Bizarre attempts to paper over the unpleasantness of the regulatory aspects of the Clinton Plan simply fueled public cynicism. As David Broder of The Washington Post has noted, cynicism in the electorate is ``epidemic'' these days. Notes Broder, ``If the assumption is that nothing is on the level, nothing is what it seems, then citizenship becomes a game for fools and there is no point in trying to stay informed.''

The Blame Game will continue through the Congressional elections and right on up into the next Congress. For the Sixties Kids at the White House, searching for the Meaning of It All, the source of difficulty rests with those who have insufficient virtue: the Forces of Darkness. These include small business and the Health Insurance Association of America, but also grassroots organizations that have come out swinging against the Clinton Plan. Indeed, Congressman Tom DeLay of Texas thinks that the modifications to the Lobbying Disclosure Act, which would have imposed all kinds of new registration and reporting requirements on the leadership of grassroots organizations, were a reaction to the effectiveness of their opposition to ``health- care reform.''

Future Strategy

Phase two of the Hundred Years War is now underway. The Clinton Administration is trying to regroup after a tough defeat, trying to figure out how to get the infrastructure of the Clinton style plan in place under the even more difficult scenario of an even less friendly Congress. Reviewing the documents released by the Task Force under pressure from AAPS, Congressman Istook (R- OK) noted that the Clinton White House had imagined one such reform option in the form of ``KidCare,'' the basis for the desperate effort by Senator Tom Harkin and others, to try to get the foot in the door for the Clinton regulatory infrastructure.

The congressional Left is going back to the barricades. Congressman Jim McDermott (D-WA) will push hard for a Canadian- style single-payer plan (government monopsony) next session. Meanwhile, the Left is trying to make it big in California with a single-payer ballot initiative. A success in California will have a tremendous impact on the fortunes of the Congressional Left in Congress, even if the Democratic majority diminishes. A failure in California, however, is going to be a serious setback. Note that the Washington health care groupies, all of the gnomes and wonks, are pouring bucks and resources into California in a desperate attempt to resurrect socialized medicine.

Still No Consensus

While there is widespread agreement on the need to control costs, reform medical liability, and do something about uninsured people, there is no consensus either among the public or the policymakers.

The Committee for a Responsible Federal Budget conducted a series of citizen exercises, supported with a grant from the Robert Wood Johnson Foundation, using a group of 500 citizens. After all-day exercises in ``hard choices,'' the conclusion was that 27 percent support a ``single payer''; 24 percent favor the provisions of the ``Mainstream Coalition''; 22 percent favor working to fix the current system; and 14 percent prefer to do nothing. As the Committee points out, there isn't even basic agreement on the issues, let alone solutions or financing options.

In the What do They Know and When Will They Ever Learn Department, most Americans still do not have a clue about how much their employer spends on medical benefits at the place of work. And too many still think that somebody else is really paying for their ``benefits.'' Another stunning survey of the extent of public ignorance on the topic was produced by the Employee Benefits Research Institute in August, 1994. Among the EBRI findings: 28 percent of all people who get health insurance through their employer think that they pay nothing (0 percent) for their health benefits. When asked to identify how much the employer contributes to their health benefits package, 50 percent of all respondents said they didn't know. While many Americans still do not understand that the employer's contribution to their health benefits package is their money, not the employer's money, economists-left, right and center-know that American households, not employers, pay 100 percent of the cost of insurance and other benefits.

It's hard to sell a market-based, consumer-choice health care alternative when huge numbers of Americans still do not even get the basic economics right.

Ever Expanding Government Regulation

The Society of Professional Benefit Administrators reports that 300 different government entities issue 1500 new requirements every year for private insurance and private employers health and pension plans. Only one third are ``adequately announced'' and of those, 1 percent have final compliance guidance. Of course, if you are not in compliance, you could be in trouble. What probably saves you is that the bureaucrats probably can't-and simply don't-keep up with their own rules and regulations.

Perhaps the first order of business in the next Congress, to paraphrase Senator Moynihan, is to just stop this mess.