Volume 53, No. 11 November,
1997
Starting with an August 22 Wall Street Journal editorial called "Medicare Showstopper," the mainstream press and talk radio are finally telling Americans the shocking truth about Medicare: British citizens, Helmut Kohl, and even Boris Yeltsin have more rights than American Medicare beneficiaries.
What Bill Thomas (R-CA) and the other Republicans did in Section 4705 of the Budget Reconciliation Act (see pp. S1-S2 and AAPS News Oct 1997)-supposedly to fix the problem while appeasing the Administration -effectively allows freedom only for a very exclusive group of senior citizens: those able to find a doctor who is completely opted out of Medicare. This was the method used in Canada to kill private medicine without a straightforward law forbidding citizens to spend their own money for medical care. Few doctors are willing to accept a dramatically lower income or able to attract enough patients willing to forgo a government entitlement.
Senators Kyl and Nickles and Congressman Archer have
introduced free-standing bills to correct the "correction": H.R.
2497 and S. 1194. The text can be downloaded from
The reporting requirement is rationalized as a necessary
defense against fraud and abuse. Those are magic words: any
measure, no matter how ill-advised, is difficult to oppose if
someone claims it will prevent or punish fraud.
But the problem with private contracting is not
fraud.
Think about it: Suppose that an unscrupulous doctor decides
to bill both the patient and Medicare for a service.
First question: How much money does the federal treasury
lose from double-dipping compared with Medicare payment alone?
Answer: the same amount. (Assume that some member of the same
unscrupulous profession would have treated the patient under
Medicare constraints.)
Second question: How much money does the patient lose from
double-dipping compared with private contracting alone? Answer:
the same amount. In fact, if the claim is unassigned, the patient
would gain back the entitlement he gave up.
Third question: What about the taxpayer? Answer: the
taxpayer loses the same amount-because Medicare pays, not because
of private contracting.
Fourth question: What about the doctor? Answer: the doctor
would receive two payments only if he filed an assigned claim.
This would be both dishonest and extremely foolish. When
Medicare pays the claim, it is supposed to send the patient an
Explanation of Medicare Benefits form. When the patient receives
the EOMB, he will immediately know that the physician violated
his word and betrayed his trust. The patient may complain to
Medicare, and the doctor can be fined $10,000 per episode,
excluded from Medicare, and imprisoned.
The Medicare program is rife with fraud because patients
do not pay directly for services in most instances. Private
contracting makes fraud very difficult because an interested
person with first-hand knowledge of the care-the patient-is
watching every transaction.
The problem with private contracting is not
unfairness.
Since the Archer-Kyl bill would expand the availability of
private contracting, it is obviously fairer than the Budget
Reconciliation Act. Moreover, we do not hear the AARP
complaining that seniors are allowed to buy nicer housing or
better food than their Social Security allotment would permit.
The problem with private contracting is that it is a
tiny tear in the seamless web of government control over
medicine. It might be enough to keep the independent
practice of private medicine alive in an age of corporate
socialism.
Realizing this, medical groups that were mostly silent in
1992 about the case of Stewart v. Sullivan are making
themselves heard. More importantly, a broad coalition of
consumer groups, including Seniors Coalition and United Seniors,
is spreading the word.
One wonders if the AARP wants American physicians to be in
the same plight as "the Old Doctor" in Chapter 30 of
Solzhenitsyn's Cancer Ward:
The most persistent and oppressive persecution had been
due to his stubborn insistence on his right to maintain
a private medical practice in the face of stricter and
stricter prohibitions. What he did was a forbidden
source of private enterprise....There were years when
he had to take down his copper plate and turn away
every patient, no matter how much they implored him or
how ill they were. This was because the neighborhood
was full of spies from the tax office, paid or
voluntary, and because the patients themselves could
never refrain from talking. As a result, the doctor was
threatened with the loss of all work, even with the
loss of his house.
WHEREAS: Physicians are entrusted with the sacred duty of
protecting the lives and well-being of their patients; and
WHEREAS: In the practice of the art and science of medicine,
physicians should adhere to the highest ethical standards for the
protection and care of their patients in order to fulfill that
sacred trust; and
WHEREAS: The Oath of Hippocrates is the centuries-old, time-
tested standard of ethics for physicians; and
WHEREAS: All physicians should swear adherence to the Oath
of Hippocrates as the common set of principles for physicians;
BE IT THEREFORE RESOLVED THAT:
the Association of American Physicians and Surgeons urges
all medical schools to administer the Oath of Hippocrates at
graduation. To that end, the Association of American Physicians
and Surgeons will send a formal request to all medical schools in
the United States to that effect.
Shalala professed concern for the "dangerous" lack of
protection of medical records and "our most sacred family
secrets," but in her view, privacy is not a right:
"Individuals' claims to privacy must be balanced by their
public responsibility to contribute to the common good,
through use of their information for important, socially useful
purposes."
"National priority activities," justifying the requirement
of personally identifiable information, include in her view
"public health, oversight of the health care system, research,
and law enforcement." Specifically, "Federal law should
permit use of information for research without consent."
Moreover, "oversight agencies can see health records, or use
them against patients, providers, and others for wrongdoing in
health or related programs"-and without the knowledge of the
patient, because notification might be "reasonably likely to
impede those activities." Law enforcement agencies would not
even need to obtain permission of a court to view records.
Senator Patrick Leahy (D-VT) said the proposal would allow wider
use of health records than Congress has permitted for bank,
cable, and video rental records (BNA's HCPR 9/15/97).
Federal agencies do now have expansive authority to seize
records from private offices. However, the search capabilities
offered by computerization open unprecedented areas to
investigators. While recognizing that there are "arguments in
favor of new restrictions to address these possibilities,"
Shalala specifically refuses to consider them: "Until more
experience is gained with the uses of computerization of these
records, and the types and frequency of requested searches, it is
premature to change existing law in this area."
One suggested use of patient records is for investigating
providers' compliance with tax laws or safety regulations.
The report states that a Federal [lack of] privacy law
should apply uniformly, regardless of setting. Presumably, this
means that the Federal government, like the Maryland State
government, could demand disclosure of information about all
patient visits, even if no third-party payment is claimed.
Dr. Denise Nagel of the Coalition for Patients' Rights
observes: "Dr. Shalala did not support restricting access to
personally identified medical information by HMOs, managed care
entities, employers, auditors, ... cost-containment managers, and
others."
The only absolute protection against abusive disclosures is
to keep all personally identifiable information out of a
networked computer in the first place. But on the heels of
passage of the national health identification number, the
Administration, on July 31, announced its opposition to allowing
citizens to opt out of having information entered into the
computer.
Private data management companies, with an abysmal record of
protecting privacy, are waiting for a green light, reports Dr.
Nagel. A recent ad reads: "Strike it rich! Turn nuggets of
[medical] data into valuable information."
"This is not one step toward the surveillance society-it is
the surveillance society," said Jerry Berman of the Center for
Democracy and Technology (NY Times:, 9/7/97).
For further information, check < href =
"http://www.atr.org">http://www.atr.org and
"In order for our anti-fraud efforts to really pay off, we
need to ... help older volunteers across the country become the
eyes and ears of our communities ... and assist us in saving
precious taxpayer dollars," stated Secretary Shalala (BNA's
Health Care Policy Report 6/3/97).
HHS is also working with the AARP to improve its public
hotline for reporting health care fraud. The "TIPS" hotline has
generated 13,000 calls since its inception nearly two years ago
(BNA's HCPR 5/26/97).
The constitutionally guaranteed civil rights of American
citizens shall be protected in administrative proceedings.
Any agency acting under color of federal or state law shall
have the right to impose only limited penalties through
administrative proceedings, even when these penalties are called
"deterrents" or "means of protecting program integrity" rather
than "punishments." Allowed forfeitures include only:
(1) Withholding of future direct payments from the public
treasury (except that Social Security benefits up to the
amount funded by actual contributions by an individual,
including amounts paid by employers in the individual's
name, plus interest, may not be withheld);
(2) Fines or civil monetary penalties not to exceed one week's
after-tax income to an individual or one week's net profit
to a corporation.
Before larger economic penalties or loss of liberty may be
imposed, the defendant shall have the right to demand a trial in
a court of law and in which the defendant has all the rights
accorded to criminal defendants. These include but are not
restricted to: trial by jury, representation by counsel,
protection against self incrimination and double jeopardy, a
presumption of innocence, and protection against unlawful
searches and seizures. Personnel of the court shall be
independent of the agency bringing the complaint against the
citizen and shall receive no direct or indirect remuneration from
that agency.
Citizens who are under investigation for violation of any
law or regulation by an administrative agency shall be informed
of their rights and shall not be penalized for exercising or
refusing to waive these rights.
No person shall be permitted to make an anonymous complaint
about a condition that carries an administrative sanction, and no
monetary rewards shall be given to informants.
This law shall supersede all federal laws that mandate or
permit larger administrative penalties to be enforced without
proper judicial procedure.
No individual agency shall be exempted from these guarantees
of citizens' rights. The law shall apply equally to the Food and
Drug Administration, the Environmental Protection Agency, the
Health Care Financing Administration, the Internal Revenue
Service, the Occupational Health and Safety Administration, and
any other agency acting under color of federal or state law.
To assure adequate consideration of the serious consequences
of abridging the rights of citizens, this Act may be amended only
in legislation specifically directed to that purpose, not as part
of the budget reconciliation process or as an amendment to
unrelated legislation.
All agreements between a citizen and a governmental agency,
in which a citizen has waived his rights, shall be held invalid
and unenforceable if signed under duress, such as a demonstrable
or perceived threat of seizure of assets, loss of licensure, loss
of liberty, loss of property value, criminal prosecution, or
other adverse consequence imposed upon a citizen under color of
federal or state law or regulation.
Citizens deprived of economic or other rights by
governmental agents acting in violation of this Act shall not be
denied access to federal court or to damages at law.
AAPS Director Lawrence Huntoon, M.D., asks whether the
dismissal has anything to do with Senate Finance Committee
hearings in which six IRS agents testified behind special screens
with black hoods over their heads and electronically altered
voices. According to Michael Hirsh ("Behind the IRS Curtain,"
Newsweek 10/6/97), IRS Acting Commissioner Michael Dolan
placed a nationwide conference call to IRS managers, telling them
to "crack down on [IRS] abuse" [of innocent taxpayers].
"Apparently, government trying to force a hard-working
farmer to lie on a public document just became politically
incorrect," writes Dr. Huntoon. Similar hearings are needed for
the behavior of HCFA, he suggested.
Hooper noted that very few, if any, statutes involving
government health programs cover how to submit a bill. Given the
lack of formal guidance, Hooper questioned the legal validity of
the requirements that originate from intermediary or carrier
guidelines, fraud alerts, or soon-to-be-released advisory
opinions, none of which are subject to the rule-making procedures
in the Administrative Procedure Act.
"We have a whole host of informal rules, and I can assure
you that in most cases...you can come up with a rule that can
contradict the rule that the government is relying on," he said
(BNA's Health Care Fraud Report 5/21/97).
In his presentation at the AAPS annual meeting on how to
respond to a federal probe, Philadelphia attorney Frank Rapoport
stated: "Other than no longer providing health care services, it
may now seem as if there are few ways to protect yourself from
the government....Special Fraud Alerts purport to inform the
community what conduct is illegal..., [but] they are vague and
difficult to apply in many circumstances."
The response of Congress has been to increase funding for
prosecutors and increase penalties. "Daunted by expensive
investigations and onerous penalties for mere mistakes,
[physicians] may simply exit the market."
In the early 1940s, Hitler convinced many people that he was
going to take over the world and nobody could stop him. I submit
that the little Hitlers are around us every day and that they can
be stopped. We need to tell our patients and the public the truth
about the plans to computerize everyone's medical records. Ask
not what others will do to protect your privacy; ask, if I don't
do it, who will?
The Archer-Kyl bill would repeal the restrictions on private
contracting in the Balanced Budget Act of 1997. Specifically, it
would remove the two-year exclusion from Medicare of doctors who
enter into such private contracts.
Senator Jon Kyl tried earlier to clarify the right of
doctors and patients to contract privately, introducing S. 1289
in the last (104th) Congress, and was severely "burned" by The
Process. Proving again: No good deed goes unpunished in D.C.
Kyl complains that Congress has failed to rein in the Health
Care Financing Administration (HCFA), just as it has long failed
to control the Internal Revenue Service (IRS). The ugly
revelations about the IRS, its victimization of innocent
taxpayers, have recently surfaced in three days of sensational
hearings conducted by the Senate. The Congress has yet to give
similar scrutiny to the HCFA, which threatens doctors who enter
into private agreements with civil penalties, fines, and
exclusion from Medicare. Now, with the new raft of fines and jail
terms under the Kennedy-Kassebaum bill, it is anybody's guess how
HCFA will interpret its new authority to combat fraud. If past
performance is any guide, it will be in the most expansive
fashion imaginable. Resolution on the Oath of Hippocrates
At the 54th annual meeting, held September 17-20 in Chicago,
the AAPS assembly passed the following resolution:Shalala Wants Your Medical Record
On September 11, HHS Secretary Donna Shalala released
recommendations to Congress concerning medical privacy, as
required by the Health Insurance Portability and Accountability
Act of 1996 (Kassebaum-Kennedy). The report is available at Department of HHS.Action Plan for the Month
Copy and distribute the enclosed premier issue of
Patient Power to your patients. Let us know
what you think-and send suggestions for future issues.
The FBI Wants Your Key
The government aims to expand law-enforcement authority
further still, seeking guaranteed access to every communication
and every stored record of every American user of encryption,
without the required Fourth Amendment notice or consent. Under
the proposed Oxley-Manton Amendment to the Security and Freedom
through Encryption (SAFE) Act, H.R. 695, which was written by the
Department of Justice, strong encryption would be outlawed unless
the private key is on file with the government.HHS Trains Senior Spies and Informers
The Dept. of HHS has awarded grants totalling $2 million to
12 advocacy groups to train seniors to detect waste, fraud, and
abuse in Medicare and Medicaid programs. "Deceptive health
practices" include overbilling or providing unnecessary or
inappropriate services.Administrative Civil Rights
At the 54th annual meeting, AAPS Past President John H.
Boyles, Jr., M.D., explained the devastating losses that could be
inflicted on physicians and Americans through Star Chamber
proceedings in which the accused has few if any rights. This is
called administrative law; it is rendered by Administrative Law
Judges, who are hired by the agency that is making the
accusation. Dr. Boyles reminded members of the Administrative
Civil Rights Act, which was endorsed by the AAPS assembly at the
49th annual meeting in 1992:Case Dismissed
On September 29, the case of United States of America
and Revenue Officer Douglas Stelmach of the Internal Revenue
Service v. Jacob Lapp was dismissed pursuant to Rule
41(a)(1)(i) of the Federal Rules of Civil Procedure. This rule
provides for voluntary dismissal by the plaintiff. Jacob Lapp
faced imprisonment for contempt of court and confiscation of his
farm for refusing to file forms that he said could not be
completed honestly (see AAPS News Aug and Sept 1997).Regulatory Violation May Be a "False Claim"
Government agencies are no longer focusing on areas of
obvious false claims, such as billing for services not rendered,
stated Los Angeles attorney Patric Hooper at a May 2 conference
sponsored by the American Bar Association and the National
Association of Medicaid Fraud Control Units. In a growing number
of cases, the government states that a patient received poor
care-or care not meeting government specifications-and that the
bills submitted were therefore false claims.Members' Page
If I Had a Computer. Back in the 60s there was a popular
folk song called "If I Had a Hammer." When we all had hammers,
the thing to do was to look for something to pound. Now that we
all have computers, we have to look for something to compute.
The problem with creating a tool and then looking for something
to use it for is that inevitably something will be broken with
all the indiscriminate pounding. In the case of computers,
patient confidentiality is being broken beyond repair. Employers
can now get lists of the drugs that their employees are taking
and figure out what diseases they have. At a hospital
demonstration of digital EEG equipment, a salesman boasted that
he could get vital signs and EKG data, by name, from any patient
in the ICU of a local hospital. He said, "This is the way things
are going and neither you nor I can do anything to stop it."
Lawrence R. Huntoon, M.D., Ph.D., Jamestown, NY
Ernest J. White, Alexandria, VA
Bert Loftman, M.D., Atlanta, GA
Alieta Eck, M.D., Piscataway, NJ
AAPS Calendar
Oct 8-10, 1998. 55th annual meeting, Raleigh, NC
Counter Attack
Senior Members of Congress, particularly Congressman Bill
Archer (R-TX), Chairman of the House Ways and Means Committee,
along with Senators Jon Kyl (R-AZ) and Don Nickles (R-OK), the
Senate Majority Whip, have introduced the Medicare Beneficiary
Freedom to Contract Act of 1997. This is serious stuff,
potentially the opening of a new and raucous debate that could
reverse the current direction of America's health care policy.
The key issue: Will you, once you turn 65, be able to spend
your own money on medical services that you want from a physician
of your choice?