Business' Lobbying Against Patients' Bill of Rights Falls Short


When the insurance industry closes ranks with the national business lobby to try to head off an unwelcome piece of legislation, it is accustomed to getting its way. But the leaders of business' campaign against the patients' bill of rights felt anything but triumphant last week as the legislation neared a climactic Senate vote.

"We've done everything we can do here; we don't have a round left to be fired," said a discouraged Patrick Cleary, vice president of the National Assn. of Manufacturers.

"We've thrown the clock out the window," Cleary said, referring to the countless lobbying trips to Congress, the dozens of early morning and late night strategy sessions and the thousands of calls from association headquarters to member companies.

In the end, business' lobbying blitz proved futile as the Senate voted Friday, 59 to 36, to approve a tough patients' bill of rights that authorizes patients to sue both their health plan and their employer over adverse coverage decisions.

The outcome shows how much the political landscape has changed in the eight years since Congress, with industry leading the way, rejected President Clinton's call for mandatory health insurance.

Even if President Bush successfully vetoes a patients' bill of rights, the business lobby will have to continue dealing with the angry tide of public opinion that propelled the legislation to his desk.

The American Medical Assn., pushing hard for the bill, split the normally solid ranks of congressional Republicans. "Our opponents have the advantage of offering anecdotal horror stories" of people denied health care by health maintenance organizations, said R. Bruce Josten, executive vice president for government affairs at the U.S. Chamber of Commerce.

Eight years ago, the insurers and the broader business lobby defeated Clinton's bill by convincing the American people that it could lead to government bureaucrats' meddling in their health coverage. Their fabulously successful advertising campaign depicted a fictional couple, Harry and Louise, worrying about federal bureaucrats in their medicine cabinets.

In victory, industry gave the job of controlling fast-rising health costs to health maintenance organizations and other instruments of managed health care.

Managed care broke the back of runaway health-care inflation and saved companies billions of dollars in health insurance costs for their workers. But that has generated resentment among workers, many of whom believe that managed care companies are not giving them the health care they deserve.

Now the fear and suspicion once directed against Clinton and First Lady Hillary Rodham Clinton are focused against business generally and managed care in particular.

In a recent Gallup Poll of confidence levels in various institutions, HMOs finished dead last. Just 15% of those surveyed declared that they had a "great deal" or "quite a lot" of confidence in HMOs. Big business, at 28%, was near the bottom of the list. The military (66%) and organized religion (60%) were at the top.

In politics, "all you need to do is sow a sufficient amount of doubt so people get nervous," said a veteran business lobbyist who asked not to be named. "In the Clinton battle, business scared the hell out of people. Now the other side is scaring people about us and sowing doubts about us."

Twice in recent years, some Republicans have joined Democrats in pushing patients' bills of rights through the House, but both efforts died in the Senate. The dynamics changed in November's elections, when Democrats drew even with Republicans in the Senate by gaining a net five seats.

"I knew we would be in trouble this year," Josten said. "In this kind of debate, facts don't matter. Votes count."

Business didn't give up. The Health Benefits Coalition, the largest business alliance fighting the legislation, typically met weekly when Congress was in session. But as things heated up in the last few weeks, the meetings were expanded to several telephone conference calls a week plus "lots of e-mails every day," said Dan Danner, senior vice president of the National Federation of Independent Business, which represents 600,000 small firms.

"Trying to keep abreast of what is fact and fiction is kind of wild during a time like this," Danner said. "Things fly around this town very quickly, whether they are true or not."

Business and the health insurers say they have no objections to independent review of HMO decisions, to direct access by HMO customers to specialists or to better coverage for emergency room visits.

But they draw the line at allowing aggrieved consumers to sue for damages against HMOs. They claim the suits will drive up costs and cause companies to drop insurance coverage for their workers.

Advocates of the bill said that it would shelter employers from being sued, that only HMOs would be punished for egregious mistakes.

Josten emphatically denied that. People don't understand, he said, that HMOs would pass the added costs of lawsuits they lost to companies with health insurance, who would pass the cost to their workers by making them pay a bigger share of total premiums.

Josten and his business colleagues did not change enough minds in the Senate. The best they can hope for now is that a compromise with the House results in a bill that gives employers some degree of protection in the courtroom.

"All hope is not lost," said James A. Klein, president of the American Benefits Council, which represents large employers. "Now more than ever, the devil is in the details. I think everybody would like to get a bill done, and we hope we can end up in a place where [business] people can live with it."

Their last line of defense is a threat by President Bush to veto a bill he feels could lead to excessive lawsuits.

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