Managed-Care Reform...Again

April 1, 2001

Congress is turning back again to managed-care reform, with Democrats and Republicans trying anew to forge a bipartisan consensus on issues such as: what options exist for a cancer patient whose health insurance company refuses to cover a quasi-

Congress is turning back again to managed-care reform, withDemocrats and Republicans trying anew to forge a bipartisan consensuson issues such as: what options exist for a cancer patient whose healthinsurance company refuses to cover a quasi-experimental treatment. Thatparticular possibility is addressed by the Kennedy-McCain Bipartisan PatientProtection Act of 2001, which is getting support from both sides of the aisle.When an insurance company denies payment for a particular cancer treatment, thepatient could sue the insurance company and the employer for up to $5 million inpunitive damages and an unlimited amount of economic or noneconomic damages infederal court. "Medical necessity" lawsuits, which are a slightlydifferent issue, would be restricted to state courts with damages allowed up tothe limit of that state’s law. Of course, concern about a potentialproliferation of lawsuits is what killed passage of any managed-care legislationin the last session of Congress. The Kennedy-McCain bill (authored by Sen. TedKennedy, D-Mass, and Sen. John McCain, R-Ariz) steps back slightly from some ofthe right-to-sue provisions that Democrats were pushing last year. But the billgoes further than many Republicans were willing to go in 2000.