By Amy Goldstein and Terry M. Neal
Washington Post Staff Writers
Sunday, May 31 1998; Page A01

Six months before this year's midterm elections, politicians of both political parties are scrambling to respond to fresh evidence of enormous public resentment against the rise of managed care.

Members of Congress are jockeying over competing bills as they engage in an impassioned debate spurred by public opinion polls suggesting that nearly nine Americans in 10 favor candidates willing to tighten the reins on health maintenance organizations (HMOs) and other types of managed care. President Clinton, for his part, has been aggressive in urging Congress to adopt protections for patients this year.

Among the electorate and within the federal government, the emergence of "patients' rights" as a potent political issue is a remarkable evolution since the GOP-controlled Congress defeated Clinton's efforts to overhaul the nation's health care system in 1994.

At the time, his plan was branded as excessive government bureaucracy. Today, surveys indicate, Americans are looking for new protections from the bureaucracy of managed care plans. The plans have tried to slow the rise of medical costs by exercising broad powers over how much and what kind of care patients may receive.

This latest variant on the health reform theme has stoked a lobbying campaign unmatched on any health issue since the height of debate over the Clinton plan. Once again, the insurance industry, business groups, doctors and consumer organizations are spending millions of dollars on advertising and mobilizing grass-roots allies.

Meanwhile, dozens of congressional and gubernatorial candidates have seized on their constituents' eagerness to gain more control over HMOs as a dominant theme of their campaigns.

The net effect is auspicious for Clinton, who first called for a "patients' bill of rights" last November. The issue has acquired momentum even as prospects for other White House initiatives to reshape domestic policies this year appear to be receding on such issues as education, child care and expanding Medicare to younger Americans.

"This is a very populist issue. It really strikes a chord," said Rep. Greg Ganske (Iowa), a physician who is one of the Republicans championing limits on managed care.

Popular as it may be, the matter of patient rights is producing considerable political angst. Democrats and Republicans alike are wrestling internally over exactly what kind of reins on managed care would be effective -- and palatable -- and over how best to wield the issue to their advantage.

Democrats must decide whether they are better off if Congress adopts a patients-rights law before the elections in November. If Congress fails to act, they can blame the GOP for thwarting what the public wants. Democrats "have a much bigger political club if health care doesn't pass," said Dan Danner, chief lobbyist for the National Federation of Independent Business and chairman of a 35-member coalition of business, employer and insurance interests that opposes tighter managed care regulations.

The dilemma for Republicans runs deeper. At one level, the very premise of a federal guarantee of patients rights conflicts with the conservative distaste for government bureaucracy as a solution to social problems. At another level, the loudest critics of such a law are traditional GOP constituencies -- employer and insurance groups that argue such a measure would increase health costs and thus cause more people to become uninsured.

Yet the party cannot afford to cede such a popular issue to Democrats as the GOP fights to retain its slender, 11-seat majority in the House. Democrats already are regarded as more sympathetic on health care matters.

The awkwardness of the Republicans' plight can be seen playing out among a group of 11 House members that Speaker Newt Gingrich (R-Ga.) assigned in March to sort through the complexities and craft a GOP bill. The group, which had promised to finish its work by Memorial Day, shared its thinking with Gingrich a week ago. The speaker told members to produce a measure that was "bolder" and more "visionary" -- one that reflected Republican ideals instead of a hodgepodge of ideas for expanding the role of government, according to participants in the private meeting. Afterward, Gingrich's foot soldiers realized they did not know exactly what he wanted. "We weren't quite sure," said Rep. Harris V. Fawell (R-Ill.).

In the absence of a GOP leadership bill, many party members have charted their own course. Of the half-dozen managed care bills before Congress, one of the most popular and far-reaching is sponsored by conservative Rep. Charles Whitlow Norwood Jr. (R-Ga.), a dentist. It has attracted 230 cosponsors, including 90 Republicans.

Norwood's bill would for the first time allow patients to sue their health plans for malpractice and give physicians more control over which plans they could join. This spring, seven Republicans defected by signing onto a Democratic measure that incorporates the "bill of rights" sought by Clinton. "This is a disaster for [the GOP]," said Chris Jennings, White House health policy adviser. "How many issues unite Democrats and divide Republicans?"

While the bills vary in detail and scope, in general they seek to empower patients by giving them more information about how their health plans work, greater ability to appeal when they are denied care and somewhat easier access to doctors they want. The measures would, for example, require health plans to pay for more emergency room visits, forbid them to restrict doctors' freedom to discuss expensive treatments with patients, and allow people with chronic or serious ailments to bypass a "primary care" doctor and go to a medical specialist.

Each of those protections is supported overwhelmingly by the public, according to a survey conducted last month by GOP pollster Frank Luntz. Perhaps the most striking finding from Luntz's poll was that 86 percent of those who responded said they would be more likely to vote for a member of Congress who voted for legislation to put those changes into effect. The poll found that two-thirds still would support such legislation even if it increased their health costs by $200 a year. Other surveys have found that support diminishes as price increases.

Those findings are consistent with other recent research that has discovered frustration with managed care, much of it based on patients' own experience. One poll by the Kaiser Family Foundation and Harvard University found that almost half of Americans said they had or knew someone who had bad experiences with their health plans, such as difficulty getting their plan to allow them to see a specialist or to pay an emergency room bill.

While such sentiment is pushing many in Congress to set limits on managed care, the insurance industry and business groups are pushing back hard. "We are getting beaten up," said Karen Ignani, president of the American Association of Health Plans. The association is spending about $1 million this year on advertising, mailings and development of policy positions, as well as working in 10 states to forge alliances with consumers and business groups in districts of key lawmakers.

The Health Benefits Coalition, the insurance and business alliance opposing most of the reforms, initially planned to raise and spend $1 million for lobbying this year. "We blew by that figure and are well into the second million," said Danner, the group's chairman.

It is this conflict between public opinion and traditional GOP constituencies that forms the core of the Republicans' dilemma and the Democrats' strategic advantage.

Though candidates of both parties are talking about health care this year, Democrats tend to be more aggressive in making the issue part of their campaigns. In a review of 126 campaign commercials in 50 contested House, Senate and gubernatorial primaries, Doug Bailey, publisher of National Journal's Hotline, found 12 single-issue ads about managed care. All were produced by Democrats.

Already, the theme of managed care ranks close with or exceeds perennial Democratic issues such as education and the environment. Bailey said he expects the health issue to become even more prominent as general election campaigns heat up.

In Montana, for instance, Robert Deschamps, the Democrat challenging Rep. Rick Hill (R), has endorsed Norwood's bill and tried to tie Hill's opposition to the bill to his background as an insurance company owner. In North Carolina, Democratic challenger John Edwards has made health care an important theme in his campaign against Sen. Lauch Faircloth (R). And in Wisconsin, Democrat Lydia Spottswood, a former operating room nurse, is using it in her race for an open House seat.

In such a climate, the stakes are exceedingly high for what ultimately is produced by the group assigned by Gingrich to develop a bill. The group's leader, Rep. J. Dennis Hastert, (R-Ill.) "single-handedly may save the GOP in 1998 through his work," said Luntz, the pollster.

GOP sources familiar with the process said that, in general terms, Gingrich favors reforms that would alter the way many Americans receive health care coverage by further opening the market and creating more competition. Among the possible routes to such change, sources said, are an expansion of medical savings accounts, "health marts" that allow small businesses to band together to buy insurance at better rates, and an expansion of tax credits for individuals or small businesses who buy coverage for their workers.

Advocates and legislators who have heard Gingrich speak about managed care in the last two weeks have come away thinking he might support the controversial idea of letting patients sue their health plans -- but his statements have been ambiguous. Gingrich and Hastert hope to complete the plan by mid-June, sources said.

In the meantime, Norwood, a member of the Hastert group, is holding out his measure until he sees what the leadership proposal contains and whether one actually materializes. But he said Republicans urgently "need a bill to debate and vote on this year."

Norwood knows the political stakes firsthand. When he went home to Georgia this month, one of the first things he heard was an ad by a Democratic candidate for governor touting managed care reform.

Protection for Managed Care Consumers Comparison of two main bills in Congress that would protect patients' rights, one proposed by Rep. Charles Whitlow Norwood Jr. (R-Ga.) and Sen. Alfonse M. D'Amato (R-N.Y.), and the other by Sen. Edward M. Kennedy (D-Mass.) and Rep. John D. Dingell (D-Mich.). Both proposals regulate individual and group insurers and group health plans. The House Republican leadership is still trying to draft its own bill.
NORWOOD/D'AMATO Consumer information: No provision. Legal liability: Eliminates federal law that prohibits individuals from suing managed care companies for medical malpractice. Care for patients with chronic conditions: Coordination of care or cost control programs may not create undue burden for enrollees with special needs or chronic conditions. In these cases, health plan must determine whether a specialist or care coordinator is appropriate to ensure continuity of care. If patients must switch plans: When change might disrupt continuity of care, must cover services for a reasonable period of time. Change of provider may be due to change in network membership, change in coverage available by employer or similar circumstances. Outside grievance procedures: After decisions have been appealed internally, plans must provide access to a neutral third-party appeals board with no financial interest in the plan.	KENNEDY/DINGELL Consumer information: Establishes grants for states to set up ombudsman's offices to help consumers choose health plans and understand their rights. Federal government would set up offices in states that failed to. Legal liability: Allows states to decide whether to eliminate the law barring individuals from suing companies for malpractice. Care for patients with chronic conditions: Patients with special conditions must have access to out-of-network providers at no extra cost, if there is no appropriate provider in plan. For enrollees with serious or chronic illnesses, plans must have process for selecting a specialist as primary care provider and accessing necessary care without impediments. If patients must switch plans: After termination of contract between plan and provider, enrollee must be permitted to continue course of treatment for up to 90 days, with extensions possible in cases of institutionalization, pregnancy and terminal illness. Outside grievance procedures: If plan denies payment after internal process, enrollee can appeal to an independent body. The plan must pay for the appeal.
SIMILARITIES IN THE TWO PROPOSALS: Access to providers: Health plans must offer a sufficient number, mix and distribution of providers to ensure patients receive timely service. Emergency service: Insurer cannot deny payment for emergency care, regardless of diagnosis, if a "prudent layperson" would have considered symptons potentially life-threatening. Privacy of records: Must establish procedures to safeguard the privacy of individually identifiable medical information. Anti-gag rule: Plans may not restrict medical communi-cations between provider and patient. SOURCES: Henry J. Kaiser Family Foundation, Rep. Norwood's office, House Commerce Committee