1601 N. Tucson Blvd. Suite 9
Tucson, AZ 85716-3450
Phone: (800) 635-1196
Hotline: (800) 419-4777
Association of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto

Volume 49, No. 11 November 1993


In 1836, during a lull in the Mexican bombardment of the Alamo, Colonel William Barret Travis drew a line in the sand with his sword: ``Those prepared to give their lives in freedom's cause, come over to me.''

Every man save one crossed the line.

Within the walls of the Christian mission-turned-fortress, 189 patriots, including David Crockett and the Tennessee Mounted Volunteers, held off an army of 4000 for 12 days. Although he knew defeat and death were inevitable, Travis answered General Antonio Lopez de Santa Anna's surrender ultimatum with a cannon shot.

Santa Anna had broken his promise of freedom to the colonists in Texas and intended to establish himself as dictator.

On October 6-9, 1993, AAPS held its fiftieth annual meeting at the Menger Hotel, next door to the Alamo, about two weeks after President Clinton's message to a Joint Session of Congress concerning his proposed Health Security Act. The 243-page draft of the Act is basically very simple. It demands the forfeiture of our freedom, and subjugation of patients and physicians to the dictatorship of a National Health Board, in return for several promises (called ``ethical foundations''). The promises, translated into plain English, are as follows:

``Universal access'' to ``comprehensive benefits'' means rationed access to-or even coerced acceptance of-politically prescribed interventions, some of them far removed from the care of the sick and the injured. (For example, ``comprehensive health education'' in schools and ``control of indoor air pollution'' in homes have a high priority.)

``Choice'' means the selection of one of the permitted alternatives. In the absence of freedom, ``choice'' can ultimately mean Sophie's choice: which of our children (or parents) will be killed (or at best allowed to die of a treatable condition) in order to ``conserve limited resources.'' The Clinton Plan would ``protect'' against medical bankruptcy by forbidding citizens to spend their own money to obtain better, potentially life-saving medical care. This restriction is required to achieve the promise of ``equality of care.''

True equality of care is impossible in the real world because of the wide differences among human beings, both patients and physicians. The pursuit of this unachievable goal requires the sacrifice of the rights to life, liberty, and property. The Clinton Plan states that ``the system should avoid the creation of a tiered system.'' The tiers are portrayed from the perspective of the politics of envy-the ``poor'' versus the ``rich.'' In operation, the two tiers are a government system based on bureaucrats' choices and a free-market system based on individuals' choices. There is no debate about which is the upper tier (now accessible to most via insurance or charity).

Just as the nation could not endure half slave, half free, a socialized system cannot endure the coexistence of a free market. The Clinton Plan would destroy private insurance and take private medicine out of the reach of all but the most wealthy or most politically privileged.

By ``fair distribution of costs'' and ``personal responsibility,'' the Clinton Plan means socialist redistribution based on ability to pay. It would not be ``fair'' in this view to allow individuals to profit from their own thrift and prudence.

Combining ``inter-generational justice'' and ``wise allocation of resources'' in practical terms means deep cuts in Medicare. The ``shared sacrifice'' would fall primarily on the old, along with others who lives are felt to be nonproductive.

As the Clinton Plan puts it, ``the nation should balance prudently what it spends on health care against other important national priorities.'' To each individual, his own life has a far higher priority than free check-ups and cough syrup for the masses of voters. Therefore, his wishes must be overridden; there will be ``new criminal penalties for fraud related to ... the payment of bribes or gratuities to influence the delivery of health services and coverage.'' [Such ``informal'' payments are common in Japan and the former Communist bloc.]

The details of the plan suggest that ``Health Security'' really means a number of other things, for example, Bankruptcy Enhancement (the regional alliance would have a privileged claim on a debtor's assets in the event of bankruptcy (which might be caused by individual or employer mandates to pay for the health plan). It is the Anti-Privacy Act because of the centralized data bank created with the Health Security Card. It is the Small Business Killer, the Bureaucrat Empowerment Act, the Medical Specialist Unemployment Act, and the Medical Technology Stagnation and Regression Act. It is the Legislature Obsoles- cence Act because it would delegate any decision remotely related to ``health'' to an independent agency.

Political pressures will probably cause the revision of the most onerous provisions of the Act (which can always be added back later, in the Budget Reconciliation Process, once the machinery is in place). But the Act cannot be fixed. It must be opposed on principle and wholly defeated. It legalizes the functional equivalent of murder by depriving Americans of their liberty to use their property to preserve or enhance their own lives. No compromise with such ``ethics'' is possible.

On October 8, 1993, the Assembly of AAPS unanimously passed a motion of unqualified opposition to the Clinton Plan because it abridges personal freedom.

The Clintons could win despite our opposition. But they should heed another historical lesson.

When congratulated on his costly victory, Santa Anna said ``it was but a small affair.'' Forty-six days later, fewer than 800 angered Texans won their war for independence, routing the Mexican army at San Jacinto in a matter of minutes.

Remember the Alamo.

The Clinton Plan

Here are some highlights of the Clinton Health Care Reform Plan, with page references to the 243-page ``leaked'' Working Group draft document obtained by the Bureau of National Affairs on September 10, 1993 [and with some translations or clarifications in brackets-emphasis added]:

``It is the obligation of every eligible individual to enroll in a health plan. Anyone who does not meet the established deadline for enrollment automatically is enrolled in a health plan when he or she seeks medical care'' (p. 15) [Ineligible individuals are undocumented aliens.]

``Any individual not eligible for the national benefit package may purchase coverage from a private insurance plan to the extent such plans are available'' (p. 17).

``Consumer out-of-pocket costs for health services in the comprehensive benefit package are limited, to ensure financial protection'' (p. 34). [See article on p. 1.]

``Each Alliance includes among its health plan offerings at least one plan organized around a fee-for-service system. A fee- for-service system is one in which patients have the option of consulting any health provider subject to reasonable require- ments...[which] may include utilization review and prior approval for certain services'' (p. 62). [The requirement to offer this alternative may be waived. Payment would be on a fee schedule, and all balance billing is banned.]

``States also may require all payers...to reimburse essential community providers'' (p. 73) [Such providers will include school-based clinics and designated entities in underserved areas, also see pp. 184-185.]

``Health plans accept every eligible person....Health plans may not terminate, restrict, or limit coverage...for any reason, including nonpayment of premiums'' (p. 74). [No private insurer could survive under these conditions.]

``Health plans in states that allow advance directives and surrogate decision making related to medical treatment are required to provide information about those legal options at the time of enrollment in the plan'' (p. 76).

A Health plan is authorized to ``limit the number and type of health care providers who participate in the health plan [and to] require participants to obtain health services other than emergency services from ... providers authorized by the health plan'' (p. 76).

``State laws related to corporate practice of medicine and to provider ownership of health plans or other providers do not apply to arrangements between integrated health plans and their participating providers'' (p. 77). [A health plan administrator can make clinical decisions based on how much the plan has exceeded the capitated amount for providing care, and the patient has no legal recourse in the form of a malpractice suit.] Also, health plans may ``use single-source suppliers for pharmacy, medical equipment, and other health products and services'' (p. 77). [While the federal government is criminalizing previously acceptable referral arrangements, this Act permits or requires the formation of monopolies, as long as they are government- approved or sponsored.]

``Once developed, only the model policies may be offered'' (p. 80).

``Any health plan that sells duplicate coverage is dis- qualified from participating in alliances. Any firm or individual who offers such policies is subject to loss of the license to sell insurance'' (p. 81). [Consumers will be forced to put all their eggs in one basket. Extra insurance is outlawed.]

[Budget enforcement: If the weighted-average premium exceeds its target, plans and providers are ``assessed'' (p. 98).]

``Tools to meet premium targets:....Limiting enrollment in high-cost plans by freezing new enrollment....Setting rates for health providers....Controlling health care investments through planning'' (p. 98).

``[S]tate and federal inspection agencies audit the work being done in hospitals, doctors' offices, and laboratories, and penalize the providers if they fail to follow the rules. Patients play a minor role, lacking reliable information....'' (p. 100).

``Health plans implement and maintain core discrete electronic documentation of all clinical encounters....'' (p. 112). [Patients will have the right to approve use of these data.]

``Major public and private payers...as well as clinics and group practices of 20 or more professionals automate the core transaction set within six months of adoption. States may deny payment to plans that have not automated transactions by that date'' (p. 119). [This is called ``simplicity.'']

The plan will ``reduce rates for office consultations to equal office visits'' (p. 133).

The ``core public health functions'' of the plan include ``enforcement functions related to air pollution (including indoor air),...handling and preparation of food, sewage and solid waste disposal,...radon exposure, noise levels,...'' (p. 145) [The plan is ``comprehensive.'']

``Fines, penalties, forfeitures, and damages...for fraud or abuse in health care delivery are deposited in a trust fund to supplement federal efforts to combat health care fraud and abuse'' (p. 172).

The new health care fraud statute is to be modeled after existing mail and bank fraud statutes. ``Current federal authority is amended to allow forfeitures of proceeds derived from health care fraud. The forfeiture remedy allows the federal government to use either criminal or civil remedies to seize assets derived from fraudulent or illegal activities'' (p. 173). [Actions that constitute ``wrongdoing'' are listed on pp. 174- 179. They include ``unnecessary multiple admissions,'' ``failing substantially to provide medically necessary services,'' and ``failing to report information or reporting inaccurate information that is required to be submitted to a data bank.'']

``Rapid implementation...is vital. To expedite implementa- tion, the National Health Board, the Department of Labor, and the Dept of HHS are authorized to issue any regulations by the Act on an interim and final basis'' (p. 217).

[On ``contributions,'' ``responsibility,'' and the functional equivalent of a payroll tax for persons not on a payroll:] ``Individuals who work less than a full year...are also responsible for any unpaid employer share to the extent that they have non-wage income'' (p. 221).

``Federal guidelines require that regional alliances exercise due diligence in collecting unpaid employer and consumer premium contributions, including the imposition of interest charges and late fees for non-payment and other credit and collection procedures. Premium contributions owed to regional alliances are privileged compared to other corporate or personal obligations in bankruptcy proceedings.

Alliances recover for unpaid premium contributions through a premium assessment paid by employers and consumers'' (p. 237).

For a copy of the 243-page draft, send $12 plus a mailing label to AAPS at 1601 N. Tucson Blvd. #9, Tucson, AZ 85716.

Constitutional Challenge to Kentucky ``Provider Tax'' Goes Forward; Court to Hear Oral Argument November 1

In July, AAPS member Stuart Yeoman, MD, and two other physicians filed suit in Kentucky challenging the discriminatory provider tax on physicians on a number of constitutional grounds (see AAPS News Sept. 1993). The Court denied a request for a temporary restraining order on the grounds that the plaintiffs had not shown irreparable harm. All Kentucky physicians and other medical providers could recover the amount of taxes they have paid if and when the statutory scheme is declared unconstitutional. The Court did expressly state that the Plaintiffs have raised serious constitutional questions.

After the Franklin Circuit Court rendered its rulings on the Plaintiffs' Motions for Class Certification and Temporary Injunction, a group of approximately ten Kentucky Health Maintenance Organizations (HMOs), which are also subject to the tax, filed suit, followed by a number of hospitals and the Kentucky Medical Association. The cases have effectively been consolidated so that Plaintiffs may receive a prompt ruling. Additionally, all parties have agreed that any appeal will be taken directly to the Supreme Court of Kentucky, bypassing the intermediate appellate court.

The Plaintiffs filed a Motion for Summary Judgment on September 15, 1993. The brief discusses at length the separation of powers guarantees of the Kentucky Constitution, arguing that the legislature has extensively delegated its power to tax. [The delegation of powers to a National Health Board under the Clinton Plan will also raise this issue.]

The Kentucky Act [like the proposed Clinton Plan] empowers the Kentucky Health Care Data Commission to audit health providers and randomly invade physicians' offices and seize medical records. This violates not only the Fourth Amendment's prohibition against unlawful searches and seizures, but also unconstitutionally invades the privacy of both patients and their physicians.

Oral arguments will be held in the Franklin Circuit Court on November 1, 1993. The Plaintiffs hope to have a ruling on the constitutionality of House Bill No. 1 by Thanksgiving.

The American Health Legal Foundation has agreed to support this case to the extent that funds can be raised. Tax-deductible contributions may be sent to AHLF/Warren County Constitutionality Challenge, 1601 N. Tucson Blvd #9, Tucson AZ 85716.


Comments on the Clinton Plan and Its Genesis

Allan Routzahn, retailer, who has lost a third of his stores in 18 months, said his company was too small for the subsidy but not large enough to benefit from the spending cap. ``Small business cannot afford this plan....tripling my costs will not work in today's economy.''

President Clinton to Mr. Routzahn: ``All I can say to you, Sir, is that if we don't do something like this, then everybody's going to be going in the same direction you are.'' Small business, he said, would have to be able to afford this plan ``for its own good'' (AP 9/16/93).

Hillary Rodham Clinton: ``I can't go out and save every undercapitalized entrepreneur in America'' (Wall St J 9/24/93).

Rep. Dick Armey (R-TX): The Clinton Plan is the ``Dr. Kevorkian prescription for the jobs of American working men and women.'' At hearings before the House, he promised to make the debate ``as exciting as possible.''

``I'm sure you will do that,'' stated Ms. Clinton, ``you and Dr. Kevorkian'' (AP 9/30/93).

Uwe Reinhardt of Princeton, consultant to Health Care Task Force: The Clinton Plan ``implies considerable supervision of doctors by lay people. That will divert income from people who lay hands on people to people who supervise doctors'' (Wall St J 9/13/93).

Lonnie Bristow, Chairman, AMA Board of Trustees: ``The AMA...welcomes the President's affirmation of many principles the AMA first called for nearly four years ago.''

Vicente Navarro, MD, of Johns Hopkins University, consultant to the Health Care Task Force: ``Cuba's quality-of- life indicators...are better than those of comparable countries in Latin America. These improvements in health are not merely a result of better medical care but rather an outcome of improvements in the socioeconomic conditions of the majority of its citizenry'' (``Capitalism Has Not Won,'' Intl J Health Serv 22:603-610, 1992).

Navarro: ``It is not possible...to save the truly scientific liberating parts of medicine and its unsexist and unracist components and throw out the rest. Medicine is a social relation in contradiction, not an instrument that can be split in different parts....Medicine is not an appendix of capitalism. Medicine under capitalism is capitalism'' (``Radicalism, Marxism, and Medicine,'' Med Anthropol 11:195-219, 1989-emphasis in original).

E. Richard Brown, consultant to the Health Care Task Force: ``[T]here are alternate ways of controlling utilization and costs....[t]riage by nurse practitioners, primary care case management, queuing for nonurgent care, and budgetary control'' (``Principles for a National Health Program: a Framework for Analysis and Development,'' Milbank Quarterly 66:573-617).

Richard Kronick, consultant to the Health Care Task Force: ``A strategy of `interim' federally imposed all-payer price controls would, in my view, be a mistake. It would not achieve much more by way of price controls than can be achieved through HIPC implementation....There is not a big time difference between the date on which we could start regulating health plan premiums and the date on which we could start regulating unit physician and hospital prices'' (Health Affairs Supplement 1993, pp. 87-98).

David M Eddy, consultant to the Health Care Task Force: ``A `minimal level of adequate care' consists...of access to more individualized forms of cure compatible with a sensible allocation of resources to the health sector in relationship to other societal requirements'' [emphasis added]....``[P]olicies that will affect millions of people and billions of dollars would be based on the value judgments of a very small number of people....[T]his approach can be applied piecemeal-one intervention at a time-...without any major commitment to legislative change'' (JAMA 265:786-788, 1991).

Judith Feder, Director of Health Policy, Transition Team, ``You can't control only a part of this system; you've got to control the whole thing'' (AAPS News March 1993).

New Members

AAPS welcomes Drs. David A. Birnbaum of Hoffman Estates, IL; Edward L. Mosley of Fairmount Heights, MD; Arnold J. Weil of Marietta, GA; Jon Johnston of Marina Del Rey, CA; Gregory J. Martonick of Walla Walla, WA; William B. Jackson of Tacoma, WA; Samuel Medrano of Sacramento, CA; John D. Stewart of Tacoma, WA; Howard Jay Hassell of San Antonio, TX; Arthur J. Ozolin of Tacoma, WA; Stewart D. Cole of Sunnyside, WA; Norman Stirling of Marina del Rey, CA; Dennis Carter of Boise, ID; Edward Kauffman of Bellingham, WA; Samuel E. Adams of Tacoma, WA; Tom Cadenhead of Denton, TX; Rosemary Crawford of Kent, WA; Gary J. Dellerson of Lake Worth, FL; Peter M. Doloni of Sharon, PA; W.C. Douglass of Atlanta, GA; Kenneth Edstrom of Puyallup, WA; Bernard E. Engel of Westminster, CO; Arthur Ginsberg of Seattle, WA; Mildred F. Jefferson of Boston, MA; Andrew Kant of Houston, TX; Harold J. Kornylak of Virginia Beach, VA; Frederick C. Kriss of Cross Plains, WI; L. Gerald Laufer of New York, NY; John Margaris of Great Falls, MT; Douwe Rienstra of Port Townsend, WA; Dennis Scharfenberger of Warwick, NY; Reuben Setliff of North Platte, NE; Wayne Smith of Heber Springs, AR; William K. Summers of Albu- querque, NM; D. W. Williamson of Tacoma, WA; James Wood of Temple, TX; and Vern S. Cherewatenko of Renton, WA.

New student members are Thomas F. Lee of Columbus, OH; Lawrence Goodstein of Lynbrook, NY; Tamara I. Buell of Columbus, OH; C. Randy Speights of Houston, TX; David Roger Witt II of Houston, TX; Deirdre McMullen of Houston, TX; Habib Emami of Brooklyn, NY; Stephen Fraser of Milwaukee, WI; and Denise C. Hossinger of Houston, TX.


Uninsured by Choice

Like millions of other Americans, my wife and I chose to insure ourselves, paying bills with funds saved and invested that did not go to insurance premiums to pay for an immense health insurance bureaucracy. To be sure, we were accepting the risk that we might be wiped out financially by catastrophic illness. But if an insurance company can accept such a risk, why can't you or I? If my wife or I fell gravely ill, we would not lack medical care. Our doctors would treat us, and we would pay what we could afford. If needed, we would become medical indigents and declare medical bankruptcy, with none of the stigma attached to personal bankruptcy. Would we have been better off financially with insurance? Certainly not. Every cent would have gone for medical care rather than a medically useless bureaucracy....

Lawrence Cranberg, PhD, Consulting Physicist, Austin, TX


AAPS Calendar

Nov. 6-7. Medical Action Committee for Education, Philadel phia (call Dr. Jerome Arnett, (304)636-8416).

Nov. 13. Health Care Reform: Implications for Patients, Practice, and Progress, Cambridge Center Marriott, Cambridge, MA, sponsored by Beacon Hill Institute at Suffolk University and M.A.C.E. Speakers include AMA President-Elect Robert MacAfee; John Goodman of NCPA; Peter Ferrara of Heritage; Stephen Cohen of Physicians Who Care; Nick Gettas of Canada; and Jeffrey Flier of Harvard. For further information, call Dr. Robert Sylvester, (207)784-1323.

Oct. 12-15, 1994, 51st annual meeting, Atlanta.