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Volume 54, No. 5 May 1998

Public-Private Partnership: What Does It Mean?

The "public-private\partnership" promoted by the Clinton Task Force on Health Care Reform, the Robert Wood Johnson Foundation, and the American Medical Association (which perhaps not coincidentally administers nearly $50 million in RWJF grants to combat alcohol and tobacco)-;is the wave of the future. "In the spirit of a new partnership with government..., the [AMA] is offering a number of concrete proposals...," stated James S. Todd of the AMA in a letter dated Mar 4, 1993 (see Box #1441 of Health Care Task Force documents at the National Archives).

Many "local partnerships" are being developed under the umbrella of RWJF and Kellogg Foundation-sponsored "Turning Point" projects in 14 states. The Arizona project, "Collaborating for a New Century in Public Health," held its first public meeting on March 6 in Scottsdale, attended by personnel from state agencies, Indian tribal governments, county health departments, the Arizona Medical Association, managed care firms, the University of Arizona College of Medicine and other educational institutions, businesses, and the "faith community." Letters of endorsement were received from former Republican Governor Fife Symington (now a convicted felon) and Republican Representative Sue Gerard, sponsor of the Arizona KidCare bill now before the legislature.

The stated goals of the project are extremely expansive, ranging from traditional public health concerns such as immunizations to "lifestyle issues" (such as alcohol and tobacco), behavioral health, law enforcement, prisons, education, and holistic healing. The emphasis is on children; program sponsors, like the Jesuits, recognize that "health habits are formed by age eight."

Facilitators suggested, and most participants agreed, that they were "in a fog." However, a permanent, concrete outcome is expected to emerge from the murkiness, after years of meetings: a "sustainable program" (tax-funded entitlements?) with "diversity" united by a "singular and compelling" vision. Much of the process will be devoted to "guiding" government decisions and needed legislation.

Computerized data collection is crucial, and five large computer firms are volunteering their help. According to one of the partners (a grant recipient), the Cochise County Health Dept., privacy concerns will be dealt with by "calling bluffs."

Some interesting principles were propounded: (1) A "partnership" need not involve equals. (2) Leadership means "realizing our followership potential." (3) Consensus must be reached. (4) Working in partnership does not come naturally. Key concepts include: global moral responsibility, "redeployment of resources," redefining and reinventing public health concepts, and "appropriate technology."

Describing the New York version of Turning Point, AAPS Director Lawrence Huntoon, M.D., states: "It reminds me of the stage performer whose underlying goal was to make statues of penguins. The performer announces to the audience that, together, they will create an animal figure that will, by the very nature of its creation, be appealing to the majority of the people....He throws a ball of clay out into the audience and asks each member to make one single impression. As the clay gets passed around, no one in the audience has any notion what direction the form is taking....When each has had a chance to contribute, the facilitator/performer `smooths out the rough spots' and reshapes some nonconforming portions of the figure and voila!...It's a penguin."

For the shape of public-private partnerships likely to emerge, physicians should examine some prototypes: HCFA/ Medicare carriers; Medicaid/managed care contractors in many states; and the AMA/HCFA collaboration that created the new "E&M Documentation Guidelines" (and previously the CPT codes and the Resource-Based Relative Value Scale).

The nature of such partnerships is to delegate quasi-governmental functions to a nominally private entity, which receives payment from tax dollars or from fees that private "users" must pay because of its monopolistic position and the need to comply with government-imposed directives. The private partner lends its credibility to complex and arbitrary regulations and can play "good cop." Once a federal prosecutor gets involved, it could "help" the target, or simply witness the destruction of potential competitors or opponents.

The reason for governmental interest in public-private partnerships, as revealed in Task Force documents (see p. 3), is that the private partner is not constrained by the U.S. Constitution. For example, the private partner might be able to circumvent the demands of due process, as in peer review, or the Administrative Procedure Act, as with "guidelines."

Before entering any collaboration, a physician should carefully assess the character of his prospective partners. Considering the record of HCFA is necessary but not sufficient. As public health is reinvented to encompass all of human action, increased cooperation is developing between government agencies, including the FBI and the Bureau of Alcohol, Tobacco, and Firearms (BATF). The videotape Waco: the Rules of Engagement by Fifth Estate Productions would be a good start for gaining insight into the nature and role of the public partner, government, and for a measure of the inequality of power vis-à-vis any private entity. The interaction of public agencies with a faith community, and the effectiveness of the oversight role of Congress and of the press are on display in this controversial tape. The viewer can evaluate the main actors inside and outside the compound for truthfulness, competence, morality, sense of justice, common sense, and compassion.

Remember that "public-private partnership" is a synonym for a popular program once called fascism.

Opting Out of U.S. Medicare

Participating physicians need not wait until the end of the year to opt out. According to the Administar Federal Medicare Part B Bulletin for March, 1998 [see http://www.aapsonline.org, Medicare Dept.]: "Participating physicians...may opt out if they file an affidavit that meets the criteria and which is received by the carrier at least 30 days before the first day of the next calendar quarter showing an effective date of the first day in that quarter (i.e. 1/1, 4/1, 7/1, 10/1). They may not provide services under private contracts with beneficiaries earlier than the effective date of the affidavit."

The same bulletin provides a "revision" regarding the Violation of an Agreement Not to File Claims. Unless the claim is for an emergency service not covered under a private contract, the physician becomes subject to all Medicare rules, including the claims submission requirement "for all services to Medicare beneficiaries (for which no Medicare payment may be made) for the duration of the `opt out' period." If a beneficiary submits the claim, this is not a violation by the physician.

There is now a Form HCFA-1490S (Patient's Request for Medicare Payment) available on-line from http://www.hcfa.gov/medicare/edi/edi5.htm. Patients are required to attach an itemized bill from the physician or supplier. However, "if a beneficiary submits a claim that includes items or services furnished by an `opt out' physician or practitioner on dates on or after the effective date of `opt out'..., such items or services will be denied."

From physicians who have opted out, AAPS is hearing that patients are accepting this decision. "Approximately 90% of our Medicare patients are signing the private contracting agreement so far," reports Myrna Trowbridge, D.O., of Valparaiso, IN. A New York physician, who wishes to remain anonymous, states that: "E&M was the last straw. I have `opted out' of Medicare with a loss of only 4 of 212 patients. I encourage everyone to do so. The sense of freedom is wonderful." Douwe Rienstra, M.D., of Port Townsend, WA, reports that HCFA informed him that the format of the letter suggested by AAPS "met the criteria specified by [HCFA]."

Notice posted by James Fitzsimmons, M.D., of Murphy, OR:

"Because this office is completely dedicated to the well-being of our patients, we must remain free of governmental interference. Only in this fashion can we serve you more effectively and honestly. As a result, no billing statement issued by this office can be forwarded to Medicare for possible reimbursement.

"All patients in this office are treated as private patients."

Opting Out in Canada

As the screws of government control tighten in Alberta, Canada, a supposedly conservative regime fears that physicians may actually take advantage of their ability to opt out.

Some proposed constraints on opting out are similar to those in §4507 of the U.S. Balanced Budget Act: physicians must either be in or completely out, and they must remain out for at least one year. (If physicians are out, their patients can receive no reimbursement from medicare.) To date, only one of 4,670 doctors practicing in Alberta has exercised this choice.

But Bill 21 goes much further: it would require that physicians get approval from the Minister of Health, who would refuse permission to withdraw "if it is determined that there is a need for that physician's services within the public system." Thus, the bill "essentially transforms a whole class of professionals into indentured servants of the state" (Calgary Herald 4/1/98).

While the American Medical Association complains of a "glut" of specialists south of the Canadian border, scarcity reigns to the north: "growing lineups for special services, conveyor belt treatment for routine services, high consumption of health-care dollars by hypochondriacs, cutbacks due to soaring government debt, stifling bureaucracies, warring pressure groups and the exodus of good doctors to greener, freer pastures" (Calgary Herald 3/21/98).

According to Dr. Martin Levant, a diagnostic radiologist in Calgary, there is only one vascular surgeon and one pediatric neurologist in all of Calgary (population 800,000). About 3,000 patients are waiting for cataract surgery.

In the conventional view, the imploding Canadian system needs to be "redesigned" with the full cooperative involvement of medical professionals and administrators, "all of whom must be working under one roof and not competing with each other for resources" (Calgary Herald). Some timidly suggest allowing people to spend their own money on health care and attempt to quiet fears of a doctor exodus by saying doctors could not "make enough of a living off this small...group of patients." If not enough did remain voluntarily in the public sector, one could always use force: "Many countries with a public-private system require doctors to put some time into the public system" (Fraser Forum, Nov 1997).

The Privacy Option

The government's stand on privacy for Medicare patients has been quite inconsistent. As recently as August, 1997, Leslie Shannon, Health Insurance Specialist at HCFA, informed patient Donald Huntoon of Des Moines, IA, that "it is unlikely that the physician will be penalized by Medicare for not billing Medicare on behalf of your wife if you refuse to permit him to submit a bill." This clearly implies that HCFA could take such action, if it wanted to. More recent statements, possibly in response to the United Seniors Association lawsuit, declare that privacy will be respected [see p. S2].

Another possible privacy loophole was discovered by Lawrence Huntoon, M.D., in perusing many pages of coding rules obligingly sent by Support Specialist Kimberly A. Neville (MML Issue 97-11: IHS Regulatory Products, Inc., Search Date: Fri Feb 06, 1998). Section 4020.3, Section 23A, subsection D, sub-sub section 2 reads as follows:

"Unassigned Claims.--If a physician indicates he does not want patients to see the diagnosis, suggest that he file unassigned HCFA-1500s on their behalf and continue to furnish statements without diagnoses to them. If you do not receive the ICD-9-CM code(s) on an unassigned claim and you otherwise have sufficient information, adjudicate the claim using fictitious code `XXO00' which identifies claims adjudicated without an actual ICD-9-CM code." [Dr. Huntoon also notes that the focus in compliance seminars is on assigned claims: unassigned claims and nonparticipating physicians make relatively poor targets.]

AAPS Calendar

May 30. Board of Directors, Hyatt-Regency at DFW Airport

Oct. 9-11. 55th annual meeting, Raleigh, NC


Due to expanded law enforcement powers in Kassebaum-Kennedy (the Health Insurance Portability and Accountability Act or HIPAA of 1996), the federal government has collected more than $1 billion in fines and settlements in health care fraud cases during the last year, a seven-fold increase over fiscal 1996. Federal prosecutors have opened more than 4,000 civil health care matters (an increase of 61%) and filed 282 criminal indictments. The number of defendants convicted for health-care related crimes rose from 307 to 363.

The Clinton 1999 budget will include a plan to double the number of provider audits. Fees would be assessed to cover all audits and cost settlement activities (BNA's HCPR 2/2/98).

Prosecutors see more staffing, more funding, and more legal tools: "They're going to continue mining the current ore until it's depleted" (BNA's Health Care Fraud Report 1/14/98).

"Providers" can expect:

Ø Increased use of the mail-fraud statute to freeze assets before indictment.

Ø Use of the new attorney general subpoena power. Unlike grand jury subpoenas, which have secrecy requirements, AG subpoenas facilitate cooperation among agencies.

Ø Increased involvement of local prosecutors in defining what constitutes fraud.

Ø Dramatically increased enforcement of new E/M coding. "You now have a 50-page set of guidelines to follow to document a 45-minute office visit." More than 6,000 possible combinations for documenting the coding for an office visit have been identified by the ACP.

Ø More RICO actions brought by private insurers.

Ø More qui tam actions, especially since the decision in Hudson v. U.S., which eased qui tam relators' concerns that big penalties might be called double jeopardy.

Ø More traps, such as HHS hospital compliance guidelines, which get providers to waive attorney-client privilege through voluntary disclosures.

Ø More trained senior citizen informers.

Ø More private contractors hired by HCFA to conduct aggressive anti-fraud programs, including the detection of "medically unnecessary services" (BNA's HCFR 3/25/98). HCFA expects the Medicare Integrity Program (MIP) private contractors to garner a return of 8-to-1 for every dollar spent on Part A audits and 14-to-1 for Part B (Medicare Compliance Alert 3/23/98).

The Private Sector and Government Control

The Clinton Health Security Act was portrayed by many, including AAPS, as a scheme for nationalizing one-seventh of the American economy. Continued review of Task Force documents, the new initiatives of major Task Force players such as the RWJF, and the incremental bills being enacted at both state and federal levels, suggest that the agenda is possibly much broader: a reinvention of American society, with foundational principles cloaked in "public health."

The keys to control include powerful law enforcement, pervasive data collection, and a dependent and compliant population. Useful tools include regulations and price controls that handicap and impoverish independent professionals and also result in artificial scarcity.

Just passing laws might not suffice. The Task Force clearly recognized that the Clinton Plan would face legal challenges. Some of the most troubling documents at the National Archives concern the use of the private sector and limited opt-out provisions to overcome these obstacles.

Excerpts from a memorandum to Walter Zelman from members of the Department of Justice, found in Box 1796 of Task Force documents at the National Archives:

"Past systems of wage and price controls have been designed to assure that transactions take place at a reasonable price, rather than to prevent certain transactions from taking place at all. A health care system that imposes a cap on total costs could operate, overtly or as a practical matter, to prevent certain types of medical treatment from taking place at all....Where the treatment sought is medically necessary─and particularly where a life-threatening condition is involved-it is entirely possible that the courts would impose some constitutional limits on the Government's ability to impose, for economic reasons, restrictions on a patient's ability to obtain treatment for which he or she is willing to pay....

"There are...ways [to protect]...against constitutional vulnerability on this score. First, doctors could be offered strong incentives to come `voluntarily' within the system, but not be faced with an absolute requirement-thus preserving some opportunity for doctors to practice, and patients to obtain care, outside the system, while guaranteeing that the vast bulk of medical transactions occur within the system....

"[S]erious issues are presented if the system operates to deny or limit the opportunity of some doctors to practice...at all....These difficulties are reduced in a system that utilizes private entities as the health care cooperatives or HMOs. The Supreme Court has allowed private entities to become very heavily involved in federal regulatory schemes without becoming governmental actors subject to due process restrictions....There appear to be few substantive limits on the nature of the authority that Congress may vest [in private entities]."

General George Patton was not surprised to see Rommel's tanks coming in formation. "I read your damn book," he said.

For Further Information...

"Administrative Simplification" and Privacy. Learn of public meetings and monitor them live on the Internet: the National Committee on Vital and Health Statistics, at http://aspe.os.dhhs.gov/ncvhs/

ACP on incremental socialism, with comment: http://pages.prodigy.com/DOCTORINFORM/acpinsur.htm.

Waco videotape. Discussion and critiques available at http://www.waco93.com.

E&M Documentation Guidelines [Medicare Dept.], the Zelman memorandum and other Task Force documents [Clinton HC Task Force]: http://www.aapsonline.org.

FOIA Laws from 50 states and an automated form generator for filing requests with the federal government, from the Reporter's Committee for Freedom of the Press: http://www.rcfp.org/rcfp/. Does your state receive grant funding?

§ § §

"It is impossible to find good [NHS]...dentists any more because they have all gone private to avoid a system that insists on the provision and justification of a detailed treatment plan for each patient. As my own, now private dentist, put it: `I went into my profession to look after patients' teeth, not to fill in forms'.... Everyone is tied up in the creation of paper trails for a distant centralized inspectorate...."

Christie Davis, "Letter from Britain," Chronicles, Nov 1997

Members' Page

Turning Toward Government Control. It seems that wherever some new program or initiative pops up to increase government control of medicine and thus undermine independent entities, we find the Robert Wood Johnson Foundation. They seem to be the agar that promotes and supports the growth of oppressive and intrusive health care systems.

On the heels of the Nushawn Williams disaster in Chautauqua County (a deviant criminal from the New York City area infected local high school girls with the AIDS virus), RWJF donated $60,000 to the Chautauqua County Health Department in order to help in "building links between the public and private sectors." Following the RWJF blueprint seen in other states, children seemed to be the initial focus. The AIDS disaster here is a made-to-order "crisis" to rally around.

The goals of the new RWJF "Turning Point" initiative for "Collaborating for a New Century in Public Health" use the benign-sounding terms we have come to recognized as socialist code for increased government control of private health care: "the need for better integration of planning, resource allocation, program design and evaluation."

Lawrence R. Huntoon, M.D., Ph.D.

Medicare Assignment. After two years of working to resolve this problem, Transamerica still manages to make errors on assigned vs. unassigned claims. Each time it happens, I have to send separate checks on each patient back to Medicare so they can pay the patient. They also send a 3-page letter to each patient accusing me of fraud, not admitting in any way that the mistake was theirs. Nevertheless, the safest thing to do is to bill unassigned. Then, if Medicare wants money back, they have to get it from the patient, and they would never do that. However, I have been unable to persuade even my closest physician friends to do this. They want to bill assigned, make as much money as they can now, and quit practicing medicine as soon as possible.

Linda W. Wilson, M.D., Culver City, CA

So How Can There Be So Much Fraud? In my practice, it is impossible to get Medicare to pay even correct bills that are coded correctly....As AAPS advocates, having the patients pay their bills directly is the best and most efficient way to provide direct on-site regulation of fees, as opposed to the horrendously expensive fraud-and-abuse mechanism currently set up by the federal government.

Lee A. Balaklaw, M.D., Louisa, KY

Purim. The Jewish Holiday of Purim, which usually arrives in March, has lessons for our spirited AAPS members, who have been known to hang offensive bureaucrats in effigy. Celebrated in a freewheeling fashion in which everyone and everything is fair game for satirization, it celebrates a time when the Jewish nation escaped planned genocide....What saved them was not...their pleading their case to the king, nor the wisdom or heroism of any great leader, but their militant resistance to oppression.

Joseph M. Scherzer, M.D., Scottsdale, AZ

Shall We Give Away Medicine Without a Fight? From a letter to Senator Phil Gramm and others: Since finishing my orthopaedic training in 1991, I have witnessed the unraveling of the best medical system in the world. The recent round of Medicare reforms, which claim to address fraud and abuse problems, are a transparent political ploy to divert attention from the basic and serious problems in government and medicine by scapegoating the most politically expendable element in the system: "providers." You have set up a system that encourages predatory behavior by those who can share in large arbitrary penalties against physicians who may make honest mistakes. A Houston law firm is now running television ads in Amarillo, encouraging fraud and abuse claims, promising a share of the penalties....

A relatively unique trait of my profession has been willingness to see patients under any circumstances, since we are not willing to let them suffer for the cynicism, greed, and shortsightedness of others. However, it appears that this willingness has been used as a weapon against physicians [see p. S2] and in the end will hurt patients whose access to excellent care will continue to dwindle....

Marshall L. Cook, M.D., Amarillo, TX

Land of the Free? A mailing from Steve Forbes reported that 50% of respondents to a survey said they would prefer being robbed to being audited by the IRS. A committee of my county medical society unanimously said that they would rather be audited by the IRS than by Medicare.

Holly Fritch Kirby, M.D., Leawood, KS

Why Retirees Are Dependent on Government. The main problem with Medicare is that people are retiring without enough money. Just $5,000/yr saved and invested without taxes over a working life of 40 years would let wage earners retire at age 60 as millionaires. The main reason they cannot do this now is the withholds from their paychecks. A family whose take-home pay is $33,000 has had $4,000 withheld for income tax, $6,000 for payroll tax, $5,000 for job-based health care, and $2,000 for job-based retirement. It is immoral to take this money from workers; they should be able to save tax free.

Bert Loftman, M.D., Atlanta, GA

Legislative Alert: AAPS Report from Washington

Common Sense of The Senate

By a narrow vote of 51 to 47, members of the U.S. Senate on April 1, 1997, expressed support for a resolution stating that senior citizens should be able to spend their own money on medical services that they want from a doctor of their choice, whether or not those services are covered by Medicare.

The resolution was a nonbinding "Sense of the Congress" resolution offered by Senator Jon Kyl (R-AZ) as an amendment to the Budget Resolution (Sen. Con. Res. 186) and cosponsored by Senators Phil Gramm (R-TX), Ernest Hollings (D-SC), Bill Frist (R-TN), Pete Domenici (R-NM), Slade Gorton (R-WA), and Majority Leader Trent Lott (R-MS).

The key language of the Kyl amendment reads as follows: "It is the sense of the Congress that seniors have the right to see the physician or health care provider of their choice, and not be limited in such a right by the imposition of unreasonable conditions on providers who are willing to treat seniors on a private basis." This is what 47 Senators voted against.

Among the findings of resolution: Medicare beneficiaries have the same right to obtain care from the physician of their choice as do Congressmen and "virtually all other Americans"; most seniors cannot exercise this right due to the "current restrictions" of Medicare; claims filed independently would not impair the health of the trust funds; and seniors should be protected from fraud and abuse and other bad things.

In offering his resolution, Kyl argued that his intention is to put the issue of private contracting on the floor for an up-or-down vote-come hell or high water-but that "This is the first opportunity we have had, so we present it to the Senate as a sense of the Senate, as part of the budget resolution, that senior citizens should have this right. Then, when the opportune time comes, we will be offering this legislation which has already been introduced and has 49 sponsors in the Senate and 190 cosponsors in the House of Representatives."

Senator Kyl noted that the Clinton Administration "has taken the position that eligibility to receive Medicare is exclusive; that is to say, "it’s either Medicare or no care" with respect to Medicare-covered services.

The Kyl victory for personal freedom is a narrow one. Indeed, the fact that 47 Senators voted specifically against such a resolution affirming personal freedom is incredible. And it’s not an April Fool’s joke. These folks don’t like the very idea of somebody exercising free will outside of the rules and regulations of Medicare, even when the taxpayer’s money is not involved. Curiously, the Senate vote turned into a largely party-line vote, with Senate Democrats lining up against the Resolution, with the notable exception of Ernest Hollings of South Carolina, and Republicans supporting it, except for Alfonse D’Amato of New York (who is expected to be in a tight race for re-election), Olympia Snowe and Susan Collins of Maine, Arlen Specter of Pennsylvania, and John Chafee of Rhode Island. Even more curiously, in responding to the arguments of a veritable line up of senior Senate Democrats opposing the resolution, Kyl was arguing-and winning- alone. The Senate Republican leadership was conspicuous by its silence during the fray on April Fool’s Day. This seems odd, because the principle involved is pretty simple. But this is becoming a tiresome story when it comes to confronting the Clinton Administration’s Senate allies on health policy.

Senate Liberals’ Defense of Medicare’s Status Quo

A close examination of the Senate liberals’ arguments against private contracting-the traditional patient-physician transactions that prevailed for centuries before the onset of third-party payment-shows how neatly they stack up. First, doctors are a greedy profession and senior citizens are all vulnerable to their avarice. (This argument is never to be applied to lawyers; either there are no greedy attorneys or the elderly simply possess superior skills in dealing with fellows like Johnnie Cochran, Robert Shapiro, Bob Bennett and their less well-known colleagues.) Second, Medicare is such a perfect program that nobody should be allowed to escape. Third, allowing people to contract under the terms of a free market will give rise to an explosion of spending. We are not making this up. Coming from members of the Board of Directors of an institution facing billions in bankruptcy, this is chutzpah of the first order: akin to the man murdering his parents and throwing himself on the mercy of the court as an orphan.

First out of the box on the doctors-are-greedy thesis came Senator Jay Rockefeller (D-WV): "This is a proposal which is written to, frankly, charge seniors more money." Even worse, "it will facilitate physician fraud at the expense of the Medicare program:" In other words, they could collect twice from Medicare and the patient. Thus, "the bill would almost certainly raise national health care spending."

Not to be outdone in the Rhetoric Department, Senator Ted Kennedy (D-MA) says: "This is not a freedom of choice amendment for patients; it is a ‘freedom to price gouge’ amendment for physicians and it deserves to be rejected by the Senate." Senator Richard Bryan (D-NV) paints the picture of price-gouging doctors in lurid terms: "A physician has the ability to say, `Look that condition you have is terminal.'" Senator Dale Bumpers (D-AR) knows with absolute certainty that free markets outside of Medicare will lead to fraud and confusion, the myriad of evils that Medicare’s ever-efficient bureaucracy, a paragon of clarity, so effectively prevents: "Think of all the different kinds of contracts people would enter into." Bumpers goes on to offer a remedy : "Mr. President, if there is a problem with Medicare, if we are not paying enough to entice [yes, the word is `entice'] a majority of the doctors in this country to provide services under Medicare, let’s raise the rates. But for Pete’s sake, let’s not allow people to enter into these private contracts....I have the utmost respect for the medical profession. But I am telling you, you are giving them unbelievable leverage over millions of Medicare patients if you allow them to say, ‘I can’t take you because Medicare is not enough."

The main point, made repeatedly, on the Medicare-is-just-fine thesis is that 96% of all doctors accept Medicare. And, according to Senator Rockefeller, 92% of beneficiaries are satisfied with the availability of care under the Medicare program. And any problems will come out in the wash: "Because everybody is in that pool, almost like the original Blue Cross, Medicare wins money on some, loses on others, but in the end everything tends to wash out evenly."

Senator Paul Wellstone (D-MN) thinks that allowing persons aged 65 years and over to go outside of Medicare is in some sense profane: "Medicare is a sacred contract with senior citizens. We ought not to create this gigantic loophole for too many providers who I fear rip off elderly people to charge fees for services that senior citizens cannot afford. We ought not to tear up a very sacred contract." Medicare will not become, in other words, something like the old-fashioned Constitution. Wellstone introduced into the record summaries of letters from a gaggle of left-wing groups, including Families USA, Catholic Charities USA, the National Council of Senior Citizens, the Service Employees International Union, and the AARP.

On the health-care-cost explosion thesis, Senator Rockefeller knows a threat to fiscal conservatism when he sees one: "Private contracting would cripple Medicare’s ability to hold down health care costs and would put elderly and disabled citizens at serious financial and medical risk." Senator Richard Durbin (D-IL) knows the bottom line: "This debate is about whether a Medicare senior going into a doctor’s office is going to have to pay according to an established Medicare schedule or whether the doctor can charge more." So, the fight is really about the maintenance of the silly Resource Based Relative Value Scale (the RBRVS system), and Medicare’s price controls.

The Modified Limited Hang-Out on The Privacy Issue

In its original brief in the case of United Seniors Association v. Shalala, the Clinton Administration said that doctors must submit all claims for all patients all the time, unless of course they are prepared to drop out of the Medicare program for two years. In one of its latest submissions, the Clinton team-for the first time-noted an exception: privacy or confidentiality. The legal team did this shortly before oral argument on March 6, following HCFA communications to Congress, both in letters to Congressmen and in HCFA Administrator DeParle’s February 26 testimony before the Senate Finance Committee. Good policy, but not consistent with what carriers have been telling doctors and patients for years.

Senator Kennedy can read the twists and turns of HCFA communications-suddenly smitten with a touching concern for patient privacy-pretty clearly. During debate on the Kyl resolution, Kennedy noted, "The reality is that in a number of instances the patient will ask the doctor not to submit a claim or the bill under Medicare. These are primarily in cases of mental health and substance abuse where the individual, for any number of reasons, fears what might happen to them in the job market or because it might make it more difficult or complex in terms of other different personal reasons and chooses to pay themselves and tells the doctor, ‘Look, don’t bill Medicare. I’ll pay you. I’ll pay you.’ ... It is not widely advertised, not widely proclaimed, but it happens today. That goes on, and the Medicare system respects that."

Question from the Peanut Gallery: When did HCFA ever advertise or proclaim confidentiality as a defense for not submitting a claim? In promulgating regulations? In carrier bulletins? In notices to beneficiaries? In mailings to seniors? Please check your files.

Senator Kyl asks, "If current law already provides this, then why does the senator object to the mere statement of the principle that the choice should exist? If the Senator is happy with existing law, he can’t very well oppose the principle that simply restates existing law." Touché, Senator Kyl, but was anyone paying attention to logic?

The Bottom Line: No Choice

Seniors and their physicians should make no mistake about it. Clear away all of the demagoguery, the political rubbish, the excuses, the empty rambling rhetoric about fraud and abuse, unscrupulous doctors, vulnerable elderly, the cold and unfeeling free market, ad nauseam, the bottom line is that the elderly are not to be given personal freedom to make their own decisions. The issue is Power. The Clinton Administration, its allies in Congress, and their minions in HCFA, are in the supreme business of control. And that-not cost, access, or quality, is now, has been, and always will be, what the debate is all about. Amen. Someday, Congressional Republicans will understand that too.

One of the leading opponents of private patient-physician agreements, Senator Richard Durbin, could not resist sharing his views on freedom: "The great philosopher Kris Kristofferson once said, ‘Freedom is just another word for nothing left to lose.’ I believe those words were actually sung or spoken by the late great Janice Joplin." You can take the liberals out of the Sixties, but you can’t take the Sixties out of the liberals. During the Senate debate, Durbin offered a counter-resolution, spelling out "findings" that the current Medicare system is fine, and arguing that no changes should be made to the Medicare program that could impose "unpredictable and unreasonable" out-of-pocket costs on the elderly; that could "compromise the efforts of the Secretary of HHS to curb fraud and abuse in the program; or that could allow "unscrupulous providers" to "bill twice for the same services."

Senator John Chafee joined in a modified version of the Durbin amendment, which did not directly address the issue of private contracting in Medicare. This modified version of the Durbin amendment also passed the Senate on a voice vote.

The Medicare Paperwork Burden

Senator Don Nickles (R-OK) recently remarked that Medicare’s regulatory regime takes up about 45,000 pages. Look for a debate to start heating up in Congress and elsewhere over the extent of the Medicare paperwork. The "E and M" Guidelines are sure to trigger interest in the Congress, assuming that physicians can explain clearly and directly their objections to these HCFA impositions. But a step in this direction was a major editorial piece, "I’m A Doctor, Not a Paper Pusher", by Jody Robinson, a internist practicing in D.C., in The Wall Street Journal (4/1/98). Dr. Robinson notes that in the Kassebaum-Kennedy bill the government authorizes 450 FBI agents to hunt down doctors for fraud and abuse, but then saturates doctors’ offices with paperwork requirements. Patients will suffer: "Every unnecessary or arbitrary documentation mandate takes away from the time available to evaluate symptoms, formulate a diagnosis or treatment plan, explain the problem, write prescriptions, and, oh yes, comfort and console the patient. These requirements are demeaning to physicians, surely among the most skilled, educated and ethical professionals in our society. Why not E and M Guidelines for Lawyers?"

PARCA: A Bonanza for Lawyers

A report by the Health Benefits Coalition released a report March 10 calling the Patient Access to Responsible Care Act "the billion dollar bill." Creating 33 new federal causes of action and opening three new types of liability under state law for health plans would result in $1 billion per year in damages payouts and defenses of meritless claims for the state actions alone. Additionally, about 3,800 new federal employees and $155 million in new federal funding would be needed for proper enforcement (BNA's HCPR 3/16/98).

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