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Testimony at Miami meeting of the Secretary's Committee on Regulatory Reform by Dr. Jose Valladares - EMTALA and OASIS - 02/25/2002


EMTALA is supposed to keep people from dying in the process of the infamous "wallet biopsy" in the emergency room.

Instead, patients are being harmed by the increasingly complicated and intimidating EMTALA compliance process. The hospital must think first of protecting itself against ruinous enforcement policies. Only then can it think of the best interests of the patients with true emergencies or of the overall interests of all the patients it serves.

Some patients are best served by transfer, as rapidly as possible, to a facility equipped to provide the best care. This is very often a county hospital, such as Parkland Memorial Hospital in Dallas. Rural or small community hospitals may spend too much time trying to "stabilize" patients who should be in a helicopter-or too much time just jumping through regulatory hoops. Physicians may be forced to attempt procedures for which they are not well qualified lest they be fined for "dumping."

EMTALA compliance is an enormous unfunded mandate on hospitals and physicians. They must either shift costs to insured or self-paying patients, or to the extent that the cost shift is prohibited by price controls, suffer financial losses. Physicians may be forced to disrupt their practices-to the detriment of their own patients-to respond to calls with the main purpose of protecting the hospital from liability.

Hospitals and physicians have responded in a completely predictable fashion. Emergency rooms or hospitals close. Physicians resign from hospital staffs to avoid taking call, leading to a critical shortage in certain specialty services such as hand surgery. Resources are shifted away from patient care into compliance attempts. Costs go up for everyone, as access and quality deteriorate.

HHS should take the following actions:

1. A study of direct compliance costs such as additional clerks, lawyers, and consultants; of indirect costs such as closure of facilities and restriction of services; and of any benefits that could be attributed to each specific regulatory requirement;

2. A vast simplification in the compliance process, and the shift in the burden of proof onto the government to demonstrate by clear and convincing evidence that a hospital acted in bad faith and contrary to its perception of the best interest of patients;

3. An acknowledgment that the costs of uncompensated care should be covered through direct, visible, honest taxation on the entire community rather than through unfunded mandates and cost-shifting, which is a tax on the sick and the injured.


The extensive, costly, prying, and intrusive questionnaires required of home health beneficiaries should probably be withdrawn, or at least substantially shortened and modified.

HHS should restrict personal data collection to (1) beneficiaries of government-funded services; (2) data shown to result in some benefit to the persons providing it-as by some relationship to a beneficial change in services received-as opposed to researchers; (3) data shown to be reliable by scientifically valid techniques (that which is made up by the surveyor if a patient declines to answer is suspect on its face); (4) data obtained with the informed, voluntary consent of the beneficiary, who must be told the potential uses, the type of confidentiality protection, the permitted disclosures, and the statutory justification.


A. Communications by government and its agents.

HHS Communications with both physicians and patients are a major problem-which translation into other languages will not solve.

1. The policies themselves are by nature confusing.

2. CMS and carriers harm the patient-physician relationship by telling beneficiaries that their physician has criminally violated the law even before the most superficial investigation has been undertaken. When shown to be mistaken, they refuse to explain to patients that their accusations were erroneous.

3. The microprint format of the Explanation of Medicare Benefits (EOMB) is difficult to read, much less understand. It may arrive long after the bills have been paid, so patients may not easily recall all the pertinent circumstances.

4. As a GAO study has shown, personnel answering telephone inquiries give incomplete or blatantly false information approximately 85% of the time, even to questions included in the FAQ section on the Internet site.

5. CMS and carriers lead patients to believe that they are not responsible for paying for non-covered services. They are inconsistent in determining what is and what is not covered.

6. The Advanced Beneficiary Notice is hopelessly complex; moreover, it impugns the integrity of physicians who charge for services that Medicare chooses not to cover.

We suggest the following improvements:

1. Communications from the government should be honest. The fact is that coverage by government insurance programs is limited, and that government-controlled fees are often substantially less than the market value of the services, or even the cost of providing them. The government should not imply that charging for noncovered services is criminal, nor should it ever communicate non-proven accusations to patients. Carriers who violate that policy should have to apologize to individual patients. 2. An EOMB should be sent promptly and for all types of services. This makes fraud-such as billing from a nonexistent office for fictitious services-self-revealing. The essential information should be in large, readable print, and in a natural language (preferably English), not code.

3. Personnel of CMS and carriers should be accountable for the accuracy of the information they provide, and physicians should be able to rely on it. Under no circumstances should a physician be fined or criminally charged for good faith reliance on information provided by a government agent or contractor.

4. The ABN should be greatly simplified. Physicians should not be forced to guess at a rationale for denying claims, when the fact is that Medicare's decisions are inconsistent, unpredictable, and often illogical. The fact that claims for a certain service are sometimes denied for Medicare's own reasons should be sufficient. It should be plain that lack of coverage does not mean that a service is "medically unnecessary," not beneficial, or even fraudulent. It should be acknowledged that "medical necessity" is an undefined and undefinable term. A service is either "covered," or it isn't.

5. A service for which Medicare allows $0 should be defined as a "noncovered" service.

B. Communications between patients and physicians

The government should see to its own communications with its citizens. It has no Constitutional authority to supervise the patient-physician relationship and is indeed forbidden to do so in the statute that created Medicare. It also has no competence to oversee private communications.

Communication with patients is a critical part of the patient-physician relationship and is the responsibility of the physician. Government agents are incapable of second-guessing the adequacy of this communication, or prescribing the methods by which it is to be achieved.

If the patient is not proficient in English, there are many ways to establish communication; family and friends may well be the best interpreters. Depending on the size of the practice and the number of patients speaking a particular language, a physician may choose to hire bilingual staff. A one-size-fits-nobody policy will only diminish the availability of affordable medical treatment to everyone.

Physicians whose native language is Spanish will probably attract many Spanish-speaking patients. They have a natural competitive advantage in this regard. But they should not be expected to provide equally attractive services to speakers of Arabic, Chinese, Farsi, Vietnamese, or any of the other thousands of languages spoken on earth. Nor should any physician be expected to pay for translating written documents, especially those that nobody wants to read no matter what language they are in.

The requirements for offering uncompensated translation services are another unfunded mandate, whose actual costs certainly exceed any conceivable benefit. There is no statutory mandate for these regulations, and they should simply be withdrawn.


Our Medical insurance and Hospital system has not caught up with the needs of the aging American people or their families. The solutions implemented in a desperate attempt to solve the increasing crisis have in fact worsened medical care. In its attempt to the control expenditures it has instead resulted in favoring more wealth for itself while the real problems that present themselves loom far on the horizon and remain largely unaddressed.

The practice of medicine today faces challenges it never before has seen. Simultaneously, medical technology with its benefits and its inadvertent escalated costs has provided a quality and quantity of life otherwise never before seen. All we are required to do is compare the average life expectancies today to fifty years ago.

How can we find solutions to these very real health problems? It is known that at least 25% of decisions made lack the necessary information due to the quality of this information, where this information comes from, and how credible and reputable are the sources that provide it. In addition to all of the political rhetoric, the skewing of data, the manipulation of statistics and things being taken out of context, not to mention the delay in obtaining this information, we have a very serious problem on our hands. Thus, the obtaining of meaningful information becomes a problem in and of itself.

Information exponentially increases itself approximately every two years. This makes it a Herculean task to keep ourselves informed and on top of the things in a timely manner despite of the tremendous growth of the internet which is supposed to facilitate the task of obtaining and putting to use this information. There are however are no "magic bullets" and there is no "quick fix" to these perplexing problems we face. The only hope exists through a joint and cooperative effort of groups integrated by all sectors of the community with equal representation from distinct geographical locations which may or may not represent unique patient populations. These would be groups that do not respond to political pressures or financial incentives that instead realistically "represent" each communities unique and specific needs.

This requires also one more important resource: the availability of direct access to Government agencies. Only through this access can we strive for the appropriate regulation and legislation of these problems, which are very complex due to the multiplicity of factors involved as well as the continuously changing dynamics of our economy. All of them need to be addressed. To single out isolated problems will not do it. Only through a sincere, honest and comprehensive approach from Government agencies working with groups that realistically represent our communities can we begin to identify and to propose solutions to the problems that face us in the 21st century and beyond.

Jose H. Valladares MD