Senate Democrats Kill GOP Amendment in First Patients’ Rights Battle; Bush Issues Formal Veto Threat

The Senate on June 21 voted 52-45 to block a Republican amendment that "threatened to derail" a patients' rights bill favored by Democrats, the Los Angeles Times reports (Los Angeles Times, 6/22). The bill ( S 283), sponsored by Sens. Edward Kennedy (D-Mass.), John McCain (R-Ariz.) and John Edwards (D-N.C.), would allow patients to sue HMOs in state court for denial of benefits or quality of care issues and in federal court for non-quality of care issues. In addition, it would cap damages awarded in federal court at $5 million, but state courts could award as much money in damages as the state allows (Kaiser Daily Health Policy Report, 2/7). Under the amendment, sponsored by Sens. Tim Hutchinson (R-Ark.) and Christopher Bond (R-Mo.), small businesses and self-employed individuals would have been able to deduct the full cost of health insurance from their income taxes, beginning in 2002 (Miller, Los Angeles Times, 6/22). Existing tax law allows small businesses and the self-employed to deduct 60% of health care costs, but the figure will rise to 100% in 2003 (Pear/Toner, New York Times, 6/22). While the amendment has "broad support" in the Senate, Democrats "closed ranks" to defeat the GOP provision, maintaining that the amendment "could have scuttled the patients' rights legislation on a technicality" -- a constitutional requirement that tax measures originate in the House (Los Angeles Times, 6/22).

Killing with 'Kindness'?
Democrats said Republicans proposed the amendment in order to "derail" the bill by giving House Republicans a "procedural reason to reject" the Kennedy-McCain-Edwards measure (New York Times, 6/22). "They want to kill (the patients' right bill) with kindness, the kindness of a tax break," Sen. Richard Durbin (D-Ill.) said (Malone, Cox News Service/Atlanta Journal-Constitution, 6/22). He added, "They know if they can put a tax amendment on this bill, it's over" (Rovner et al., CongressDaily/AM, 6/22). Senate Republicans called the amendment "imperative," maintaining that the bill would "tend to increase the number of people" without health insurance (New York Times, 6/22). "This is one small step and a very ... significant step in turning back the direction of this legislation, which is to increase the number of uninsured," Hutchinson said (CongressDaily/AM, 6/22). In yesterday's vote, three Republicans -- Sens. Lincoln Chafee (R.I.), Charles Grassley (Iowa) and McCain -- joined 49 Democrats to "beat back" the amendment (New York Times, 6/22). Sens. Jeff Sessions (R-Ala.), Zell Miller (D-Ga.) and Jim Jeffords (I-Vt.) abstained.

Bush's Veto Threat
Meanwhile, President Bush yesterday issued a veto threat -- "this time in writing" -- promising to reject Kennedy-McCain-Edwards "unless significant changes are made" (Los Angeles Times, 6/22). The White House said that the bill would prompt an "explosive growth" of lawsuits and increase health insurance premiums, forcing many employers to drop coverage for employees. Bush said that the legislation "could cause at least four to six million Americans to lose health coverage" (New York Times, 6/22). The "strongly worded" three-page statement "surprised" Senate Democrats and "set the stage for a showdown." Democrats had predicted that Bush would sign the bill "rather than risk a political backlash" (Welch, USA Today, 6/22). Kennedy called Bush's statement a "distortion and misrepresentation" of the bill that "could have been written by the HMO industry itself" (Dewar, Washington Post, 6/22). "The president should stand with [patients], and not with HMOs and insurance companies," he added (Koszezuk, Philadelphia Inquirer, 6/22). Senate Majority Leader Tom Daschle (D-S.D.) also "expressed disappointment" with the veto threat. "It doesn't serve anyone's purpose to threaten vetoes right now," he said (Archibald, Washington Times, 6/22). However, Sen. Judd Gregg (R-N.H.) "praised" the White House for "stepping up its attack" on the bill, adding that Bush "is making it clear that there are going to be parameters" (Los Angeles Times, 6/22).

Veto 'Risky'?
Still, the New York Times reports that the veto threat "carried some risk." A New York Times/CBS News poll found that 65% of Americans favor legislation that would allow patients to sue HMOs for denials of care (New York Times, 6/22). Administration officials "are mindful" that Bush's position "risks upsetting voters," the Los Angeles Times reports (Los Angeles Times, 6/22). However, Republicans "privately expressed relief" over Bush's statement, saying that the move would allow them to "build support for less expansive" patients' rights bills in the House and Senate (McQueen, AP/Nando Times, 6/22). Some lawmakers suggested that Bush "was staking out a hard line" at the beginning of the patients' rights debate "with the idea that concessions might have to be made later." The move may also allow the White House to "claim credit for any bill that eventually emerges from Congress." Democrats, pointing out that "public opinion was on their side," offered "no inclination to make concessions" to Bush (New York Times, 6/22).

Amendments to Continue
Republicans said that they would continue to offer amendments to the Kennedy-McCain-Edwards bill (Los Angeles Times, 6/22). The Washington Post reports that future amendments will likely target lawsuits, medical savings accounts and states' rights to establish their own patients' rights regulations (Washington Post, 6/22). Republicans also indicated that they will offer an amendment that would include medical malpractice reforms backed by the American Medical Association and asked the group to provide "active support" for the provision (Rovner, CongressDaily, 6/21). CongressDaily/AM reports that the Senate will likely vote on an amendment today that would force HMOs to cover the cost of clinical trials (CongressDaily/AM, 6/22). While "claiming enough votes" to pass his legislation, McCain said that supporters "may not have the votes to fend off all major amendments" (Washington Post, 6/22). Senate Democrats "conceded" that they "face a tough fight," citing the "lobbying clout" of the managed care industry (Entous, Reuters/Detroit Free Press, 6/22). However, Kennedy said that he expects Democrats to "fend off" most of the amendments (Cox News Service/Atlanta Journal-Constitution, 6/22). Senate Republicans also "pledged to force Democrats to take as much time as needed" to pass legislation that Bush would sign, despite a July 4 deadline set by Daschle. "We're not going to be stampeded on this issue," Sen. Phil Gramm (R-Texas) said (Washington Times, 6/22). "[T]here's not a rush to judgment," Gregg added (Cox News Service/Atlanta Journal-Constitution, 6/22).

GOP Leaders Offer 'Best Boat'?
Meanwhile, House Republican leaders plan to offer their own patients' rights bill, which will likely include a provision that would allow patients to sue health plans in state courts if plans refused to abide by decisions made by outside appeals panels. House Speaker Dennis Hastert (R-Ill.) said yesterday that the White House could support the measure (Los Angeles Times, 6/22). "That might be the best boat they have going out of the harbor here," he said (USA Today, 6/22). The Washington Post reports that the White House indicated support for the legislation. White House spokesperson Ari Fleischer said that the legislation "conforms with the president's principles (Washington Post, 6/22). It remains "uncertain" if "such a compromise would satisfy Democrats," the Los Angles Times reports (Los Angeles Times, 6/22). Rep. Ernie Fletcher (R-Ky.), who helped draft the GOP House leadership bill, said, "It's a good, balanced approach." Daschle added that he "was encouraged" by the effort (Philadelphia Inquirer, 6/22). CongressDaily reports that the legislation has "so far failed to attract many Republican moderates or Democrats." GOP aides said that "it is too soon to tell who will support the bill." Hastert said yesterday that the GOP leadership bill will move through a "multi-committee process" and will not likely appear on the House floor before the July 4 recess (Fulton, CongressDaily, 6/21).