By Phil Ashford

OCTOBER 19, 1998:  Even with all its PG-13-rated distractions, the Senate last week delivered the death blow to the proposed "Patient's Bill of Rights." Given the mess that has been made of health-care policy in this country, it remains fairly difficult to determine how we should be thankful for a vote that ultimately protects the insurance companies.

If our last Great Leap Forward in health care lay in making insurance agents part of the medical process, the Patient's Bill of Rights would have asked us to stir a few lawyers into the mix as well. Ponder that for a moment.

This year's defeat is largely the consequence of President Clinton's travails, the desire of the Democrats to have another election issue, and the fact that the majority Republicans never much liked the concept anyway. However, too many real human issues are involved here to think that the problem will go away once the parties have run out of political games to play over it. In fact, the proposal will surely be back next year.

The central component of the bill of rights concept has been to give patients the right to sue insurance companies when they are denied care. The concept here, apparently, is that the penny-pinching insurance companies will think twice about denying a few extra tests or procedures if they are faced with the prospect of looking down the business end of a massive tort lawsuit.

While removing the immunity of insurance companies from civil actions might have a few initial benefits, the more likely effect will be to tangle us all further in the disjointed jumble of policies and procedures that make up what we call (inexplicably without irony) the U.S. health care system. In that context, it is worthwhile to look at how we got to the current point, because it underscores the great lost opportunity of 1994.

Essentially, our sense of crisis about health care began back in the 1970s, when medical inflation began to dramatically outpace increases in general wage and price levels. Providers increased prices, which were meekly paid by insurance companies, who increased prices which were in turn meekly paid by employers, who tried when they could to pass the increases on to employees. This system worked fine until all the slack was used up and everyone was faced with the implications of their own cost increases.

One answer to this problem came with the growth of managed care in the '80s. Managed care moved the fulcrum in the relationship between providers and insurers, giving the insurers the leverage to push back on prices, yielding some modest progress on cost containment. The progress came with a price tag, however, in terms of diminished patient choices and the now familiar horror stories about denied care.

The related problems of plan portability, preexisting condition coverage, and the quarter of the population that lacked any health care coverage, seemed to bring matters to a head in the early '90s. When little-known Harris Wofford rode the issue to upset former governor and U.S. attorney general Richard Thornburgh in a special Senate election in Pennsylvania in 1991, it appeared that the hour had come for comprehensive reform.

The presidential victory of Bill Clinton in 1992 seemed to be the last piece of the puzzle. Clinton had campaigned on a promise to do something about health care, and it was the sort of thing that all his wonkish pals reveled in.

The key to Clinton's approach was a trade-off: Middle-class citizens would get the insurance reforms that dealt with portability and preexisting conditions; working-class citizens would benefit from universal coverage requirements. For business, there would be cost containment, and for providers, there would be relief from uncompensated care provisions.

While the Clinton proposal was not perfect, it did attempt to address the needs of all the major constituencies. By offering something for everyone, the administration hoped there would be broad support for a comprehensive bill. The reforms the bill offered carried a price tag for everyone involved--but also the promise of getting the things most important to them that were unreachable outside the context of a universal settlement.

The moment came and went in one of the nation's most epochal political conflagrations. The expected coalition broke apart on the rocks of its components' individual interests and a sea of mistrust and misinformation. Republicans seized control of Congress, Clinton was marginalized to the point where he even had time to take up dating again, and his administration was effectively over as a prime moving force in politics in spite of his personal regeneration.

There were plenty of villains: The health-insurance industry and its Harry-and-Louise ads; Betsy McCaughey Ross, whose contentious article in The New Republic gave unfounded credibility to the plan's critics and propelled her to the lieutenant governorship of New York; congressional Democrats, who failed to rally around one of their party's longest standing dreams; and providers who didn't want the party to end.

Into the hottest-fires-of-hell category must go House Republicans. When Clinton first offered his plan, Senate Republicans countered by offering a proposal that sought to sever the tie between employment and health insurance. For a number of reasons, it made more sense in broad conceptual terms than the Clinton proposal and could have been the basis for reasonable negotiations. But the Senate plan fell by the wayside once House Republicans realized they could defeat the Clinton plan, scoring a cheap political victory at the price of a reform opportunity everyone knew in their hearts was needed (although not necessarily in the form offered by Clinton).

If anyone rivaled the House Republicans, it was then-representative Jim Cooper of Tennessee, who gave respectability to opponents of the plan with an alternative of his own that struck at the most important element of the plan and the one area where Clinton would not compromise--universal coverage. But Cooper has already been consumed in the fire he fanned.

In the aftermath, we are left with no reform and no satisfaction. The implicit decision that was made when the health bill went down in 1994 was that the natural forces of the market would be relied upon to curb the cost of health care. That meant the job would fall to the managed-care companies--the HMOs and PPOs that have become the target of so much current vilification.

Essentially, the managed-care companies have been called upon to do the dirty job of imposing some discipline on the health system, but no one in the political establishment has had the stomach to put it in place. Moreover, their performance has left considerable room for improvement.

The original concept of managed care offered considerable promise. On the macro level, big companies would, by pooling and disseminating information about the best practices and new innovations, improve the quality of care while also reducing the cost of treatment. On the individual level, doctors would actively oversee individual patients' needs with a regimen of preventive care that would drive down costs in the long run and promote greater wellness.

None of that promise was kept, however. The managed-care companies, faced with the burden of being asked to do too much too soon, developed not as innovators but as mere organizers of patient cartels with the sole rationale of using blunt force to club providers into accepting lower margins. The doctors, more harried in a new and chaotic environment, are in no better position than they ever were to think much beyond the sick people in their offices. They certainly aren't getting any special help from their new friends at the managed-care companies.

Thus, with no will to take on any serious reform beyond the impotent Kennedy-Kassebaum bill, the Patient's Bill of Rights entered the picture.

Unleashing the lawyers, however, was not much of a plan. It was more like looking at a difficult problem on the chess board and randomly moving the pieces in the hopes that some good would come of it.

Some good may, in fact, have come of it. Some of the worst HMO abuses may have been restrained by the prospect of legal action, at least until the insurance companies redesigned their policies to enhance their protection from such things. But the ultimate problem with the health care system is that it involves too much wealth to bring out the best impulses in those involved. Adding the plaintiffs' bar does nothing to change that. For, if the basic problem of the health care system over the last two decades has been one of too many pigs at the trough, it is unclear what the long-term benefits of introducing one more herd would have been.

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