Crisis of conscience: reconciling religious health care providers' beliefs and patients' rights

In this note, Katherine A. White explores the conflict between religious health care providers who provide care in accordance with their religious beliefs and the patients who want access to medical care that these religious providers find objectionable. Specifically, she examines Roman Catholic health care institutions and HMOs that follow the Ethical and Religious Directives for Catholic Health Care Services and considers other religious providers with similar beliefs. In accordance with the Directives, these institutions maintain policies that restrict access to "sensitive" services like abortion, family planning, HIV counseling, infertility treatment, and termination of life-support. White explains how most state laws protecting providers' right to refuse treatments in conflict with religious principles do not cover this wide range of services. Furthermore, many state and federal laws and some court decisions guarantee patients the right to receive this care. The constitutional complication inherent in this provider-patient conflict emerges in White's analysis of the interaction of the Free Exercise and Establishment Clauses of the First Amendment and patients' right to privacy. White concludes her note by exploring the success of both provider-initiated and legislatively mandated compromise strategies. She first describes the strategies adopted by four different religious HMOs which vary in how they increase or restrict access to sensitive services. She then turns her focus to state and federal "bypass" legislation, ultimately concluding that increased state supervision might help these laws become more viable solutions to provider-patient conflicts.     

Medical liability and health care reform

We examine the impact of the Affordable Care Act (ACA) on medical liability and the controversy over whether federal medical reform including a damages cap could make a useful contribution to health care reform. By providing guaranteed access to health care insurance at community rates, the ACA could reduce the problem of under-compensation resulting from damages caps. However, it may also exacerbate the problem of under-claiming in the malpractice system, thereby reducing incentives to invest in loss prevention activities. Shifting losses from liability insurers to health insurers could further undermine the already weak deterrent effect of the medical liability system. Republicans in Congress and physician groups both pushed for the adoption of a federal damages cap as part of health care reform. Physician support for damages caps could be explained by concerns about the insurance cycle and the consequent instability of the market. Our own study presented here suggests that there is greater insurance market stability in states with caps on non-economic damages. Republicans in Congress argued that the enactment of damages caps would reduce aggregate health care costs. The Congressional Budget Office included savings from reduced health care utilization in its estimates of cost savings that would result from the enactment of a federal damages cap. But notwithstanding recent opinions offered by the CBO, it is not clear that caps will significantly reduce health care costs or that any savings will be passed on to consumers. The ACA included funding for state level demonstration projects for promising reforms such as offer and disclosure and health courts, but at this time the benefits of these reforms are also uncertain. There is a need for further studies on these issues.     

Special report on health care delivery systems. Trends in the integrated delivery of health care and the corporate practice of medicine

The prospects for federal legislation preempting state corporate practice restrictions are unclear. The health care reform bill originally introduced by President Clinton contained a provision that would have preempted "any state law related to the corporate practice of medicine" insofar as it applied to the arrangements between non-fee-for-service health plans and their participating providers. H.R. 3600/S. 1757, 103d Cong., 1st Sess. 1407(b) (1993). Whether and in what form a preemption provision may survive the legislative process and see a Presidential signature remains to be seen. The particular fate of the federal legislation notwithstanding, however, health care executives can nevertheless remain confident that the legal treatment of the "corporate practice" of medicine will continue to be of vital concern as the various forms of health care organizations evolve in the ongoing struggle to deliver quality medicine at affordable prices.     

The failure of community benefit

Though proponents of tax exemption for health care providers continue to extol the virtues of the community-benefit test, Part II of this article illustrates that the train pretty much has already left the station on this front. Both the federal government and the states increasingly look to uncompensated care as the touchstone of exemption for health care providers. To a great extent, this transition back to a "relief of the poor" standard for exemption is the result of the inherent lack of precision in community benefit standards, along with the general trend of empirical evidence that nonprofit health care providers behave similarly to their for-profit counterparts. Faced with this situation, federal and state policymakers naturally have focused on charity care as the one quantifiable behavioral difference to justify exemption. Nevertheless, some empirical evidence suggests that nonprofits may engage in socially desirable behavior other than simply free care for the poor, and the arguments that a mixed ownership system provides the best overall health care model cannot be dismissed out of hand. Thus, despite my past criticisms of the community benefit formulation, I have come to the view that we should seriously consider the options available beyond complete repeal of the community benefit test or a return to a strict charity-care exemption standard. I continue to believe that we should demand a fairly high level of "accountability" from exemption, however, and that exemption should have some direct causal connection to whatever socially-desirable behavior we are seeking. While one option along these lines is to adopt Nina Crimm's approach of rewarding specific behaviors through a deduction or credit system, using "enhancing access" as a test of exemption may provide the best combination of flexibility and verifiable behavioral differences to support continued exemption for health care providers.     

Are Forensic Evaluations “Health Care” and Are They Regulated by HIPAA?

Forensic mental health providers (FMHPs) typically do not release records to the examinee. The Health Insurance Portability and Accountability Act (HIPAA) federal regulations might change this position, given that they have created a basic right of access to health care records. This legislation has led to a disagreement regarding whether HIPAA regulates forensic evaluations. The primary argument (and the majority of scholarly citations) has been that such evaluations do not constitute “health care.” Specifically, in this position, the nature and purpose of forensic evaluations are not considered related to treatment (amelioration of psychopathology) of the patient. In addition, it asserts that HIPAA applies solely to treatment services; thus, forensic evaluations are inapplicable to HIPAA. We describe the evidence for and against this argument, the strengths and limitations of the evidence, and recent court decisions related to it. The weakest part of the “HIPAA does not regulate forensics” argument is that HIPAA has no exclusion criteria based on type of services. It only creates an inclusion criteria for providers; once “covered,” all services provided by that provider are thence forward “covered.” Authoritative evidence for patient access can be found in the HIPAA regulations themselves, the US Department of Health and Human Services’ commentaries, additional statements and disciplinary cases, the research literature, other agency opinion, and legal opinion. It appears that the evidence strongly suggests that, for those forensic mental health practitioners who are covered entities, HIPAA does apply to forensic evaluations. The implication is that FMHPs potentially face various federal, state, and civil sanctions for refusing to permit patient access to records.     

The ghost that slayed the mandate

Virginia v. Sebelius is a federal lawsuit in which Virginia has challenged President Obama's signature legislative initiative of health care reform. Virginia has sought declaratory and injunctive relief to vindicate a state statute declaring that no Virginia resident shall be required to buy health insurance. To defend this state law from the preemptive effect of federal law, Virginia has contended that the federal legislation's individual mandate to buy health insurance is unconstitutional. Virginia's lawsuit has been one of the most closely followed and politically salient federal cases in recent times. Yet the very features of the case that have contributed to its political salience also require its dismissal for lack of statutory subject matter jurisdiction. The Supreme Court has placed limits on statutory subject matter jurisdiction over declaratory judgment actions in which a state seeks a declaration that a state statute is not preempted by federal law--precisely the relief sought in Virginia v. Sebelius. These statutory limits are a sea wall; they keep out, on statutory grounds, some suits that should otherwise be kept out on Article III grounds. The statutory and constitutional limits on federal jurisdiction over suits like Virginia v. Sebelius insulate federal courts from the strong political forces surrounding lawsuits that follow from state statutes designed to create federal jurisdiction over constitutional challenges by states to federal law. This Article identifies previously neglected jurisdictional limits, shows why they demand dismissal of Virginia v. Sebelius, and explains why it is appropriate for federal courts to be closed to suits of this type.     

Special report on taxation. Court of Appeals denies tax exemption based on "substantial commercial purpose"

When viewed against the background of continuing state and federal legislative efforts to limit the availability of tax-exempt status, the Living Faith case could be seen as yet another indication of difficult times ahead for nonprofit providers. Although it is too early to tell whether this will in fact be the case, tax-exempt providers should be aware of the Living Faith case as perhaps the clearest statement from a federal appeals court in recent years that the operation of an enterprise in too businesslike a manner may make it a taxable activity. Tax-exempt providers that now operate or plan to operate ancillary businesses, whether through joint ventures, wholly-owned subsidiaries, or otherwise, should carefully evaluate such activities against the criteria articulated in Living Faith. This analysis is important not only for purposes of determining whether such activities can qualify for tax-exempt status in and of themselves, but also as an indicator of how such activities might affect the tax-exempt status of the provider.     

The constitutionality of current legal barriers to telemedicine in the United States: analysis and future directions of its relationship to national and international health care reform

The current health care crisis in the United States compels a consideration of the crucial role that telemedicine could play towards deploying a pragmatic solution. The nation faces rising costs and difficulties in access to and quality of medical services. Telemedicine can potentially help to overcome these challenges, as it can provide new cost-effective and efficient methods of delivering health care across geographic distances. The full benefits and future potential of telemedicine, however, are constrained by overlapping, inconsistent, and inadequate legal and regulatory frameworks, as well as the repertoire of standards imposed by state governments and professional organizations. Proponents of these barriers claim that they are necessary to protect public health and safety, and that the U.S. Constitution gives states exclusive authority over health and safety concerns. This Article argues that such barriers not only fail to advance these public policy goals, but are unconstitutional when they restrict the practice of telemedicine across state and national borders. Furthermore, the interstate and international nature of telemedicine calls for increasing the centralized authority of the federal government; this position is consistent with the U.S. Constitution and other governing principles. Finally, this Article observes that the U.S. experience bears some similarities to that of other nations, and represents a microcosm of the international community's need and struggle to develop a uniform telemedicine regime. Just as with state governments in the U.S., nations are no longer able to view health care as a traditional domestic concern and must consider nontraditional options to resolve the dilemmas of rising costs and discontent in the delivery of health care to their people.     

A conversation with Donald Berwick on implementing national health reform

Michael Birnbaum interviews Donald Berwick shortly after his departure from the Centers for Medicare and Medicaid Services about the national health care landscape. Berwick discusses the strategic vision, policy levers, operational challenges, and political significance of federal health care reform. He rejects the notion that the Affordable Care Act represents a government takeover of health care financing or service delivery but says the law's Medicaid expansion and its creation of health benefit exchanges present a "watershed moment for American federalism." Berwick argues that the solution to Medicare's cost-containment challenge lies in quality improvement. He is optimistic that accountable care organizations can deliver savings and suggests that shifting risk downstream to providers throws the health insurance model into question. Finally, looking to the future, Berwick sees a race against time to make American health care more affordable.     

Access to medical care for HIV-infected individuals under the Americans with Disabilities Act: a duty to treat.

In 1990, Congress enacted the Americans with Disabilities Act (ADA). This Note examines the legislative history of the ADA and uncovers Congress's intent to impose a duty on health care providers to treat people with disabilities unless an individual poses a "direct threat" to the health or safety of others. This Note posits that, with the passage of the ADA, Congress imposed a statutory duty on health care providers to give care to people infected with HIV who qualify under the statute. This Note concludes that while the "direct threat" exception may lessen the impact of the ADA, those infected with HIV should enjoy greater access to health care than ever before.     

Special report on liability and insurance. An update on assignment of patient benefits under ERISA

While the holdings in Davidowitz and Arkansas Blue Cross & Blue Shield arose in different contexts, they both reflect the courts' increasing willingness to consider the importance of cost containment in the health insurance arena, even though patient accessibility to health care may be restricted as a result. If the holding in Davidowitz is not successfully appealed, providers may need legislative relief in order to retain their ability to take valid assignments of patient claims for payment from ERISA plans. It is uncertain whether such legislation can be sought at the state level or must instead come from Congress due to ERISA preemption of state legislation. Clearly, the district court decision on remand in Arkansas Blue Cross & Blue Shield will be closely watched for any light it may shed on this question. On a pragmatic note, providers who have not entered into "participation" agreements with insurers or other private payors may now have a greater incentive to do so, and "nonparticipating" providers who continue to obtain assignments from patients in order to collect directly from insurers or other private payors should determine on a case-by-case basis whether the source of the patient's benefits is a group health plan--which is likely to fall under ERISA and may contain nonassignment provisions--or some other form of coverage. For an additional perspective on insurers' responses to copayment waivers, see Newsletter, Vol. 6, No. 10, October 1991, at 7.     

State Medicaid reform under Section 1115 demonstration authority

Given the complexity of federal Medicaid law and the limitations it imposes on state flexibility, it is likely that states will continue to ask the Secretary to grant waivers under Section 1115 to allow them to pursue new approaches to health care reform. The results of currently operational Section 1115 projects involving statewide managed care systems will be useful in evaluating the Medicaid reform measures currently under discussion in other states and at the federal level. In particular, the ability of the states to control Medicaid and indigent care costs and to utilize federal dollars more efficiently should prove important in evaluating a block grant approach to federal Medicaid funding. Moreover, Section 1115 project results that bear on the sufficiency of various Medicaid capitation rate methodologies will also be of value as more states expand the use of managed care arrangements for their Medicaid populations.     

Considerations in Medicare reform: the impact of Medicare preemption on state laws

This article explores the key issues involved in understanding the impact of Medicare preemption on state laws affecting the federal purchase of managed care products, as a consideration in future Medicare reform. Author Commander Jackonis argues that any further Medicare reform must address the impact of federal preemption on quality and quantity of care purchased in order to ensure the existence of a market of product providers, as well as to ensure protection of patient rights and benefits.     

The stages of managed care regulation: developing better rules

The managed care industry is at a crossroads. Belief in the ability of market forces alone to create an environment fostering quality health care at lower cost is eroding. Regulators across the country are confronted with a growing consumer backlash against managed care. As a result, states have passed managed care reform legislation at unprecedented rates. In doing so, states are confronted with a patchwork of federal intervention and preemption. We examine the stages of these recent state and federal developments and evaluate them in terms of the traditional objectives of a reasonably functioning health care system: quality care, access, and cost containment.     

Special report on reimbursement. The safe harbor for small investment interests: where do joint ventures go from here?

There is no specific federal self-referral legislation presently proposed or in effect that statutorily prohibits providers from referring Medicare or other patients to entities in which the referrers have an investment interest, except for existing "Stark" legislation, which applies only to clinical laboratory services, effective January 1, 1992. (See Newsletter, Vol. 6, No. 1, January 1991, at 3.) Thus, health care joint ventures are not per se illegal. The publication of the Safe Harbor Regulations does nothing to change this fundamental fact, and it should not cause providers to abandon existing joint ventures, or planned ones, in a "knee-jerk" fashion, without careful analysis. Of course, there is no guarantee that expanded "Stark" legislation, or some other new self-referral legislation, will not be enacted in the future to prohibit providers from referring patients to entities in which they have an investment interest. Because of this uncertainty, all health care joint ventures should contain "unwinding" provisions to govern the rights and obligations of investors in the event that the venture is required to, or the participants voluntarily elect to, dissolve. Any new venture being contemplated should plan for dissolution, and existing ventures should undertake an internal review of their charter documents to assess whether the rights and duties of all participants upon dissolution are properly spelled out. If not, amendments should be made now, while all participants are on good terms. A failure to agree in advance upon such important issues is an invitation to discord, and possibly even litigation.     

Three meanings of capacity; or,why the federal government is most likely to lead on insurance access issues

This essay considers on what health policy issues the federal government is best able to lead. Positive leadership requires knowledge, power, and will. The federal government has different supplies of each for different aspects of quality of, cost of, and access to health care. Here I review technical capacity to attain desired ends, define the institutional strengths and weaknesses of the federal government, and outline current dynamics of the national political process. This analysis suggests both prospects for and some characteristics of successful policy. The federal government is more likely to lead on insurance than on other health policy issues because its supply of relevant knowledge and power is relatively high on insurance issues and the political barriers are lower than conventional wisdom suggests. But that leadership could take the form of either the expanding or contracting of access to insurance.     

No room at the inn: a snapshot of an American emergency room

The emergency rooms of American hospitals have frequently become the principal suppliers of nonurgent primary care to the under- and uninsured. Canvassing published reports and using original data obtained from a representative urban hospital, Erik Olson examines the demographics of the American emergency room and analyzes its finances. The costs of providing primary care are shifted, to the extent possible, to those who can pay. The result is escalating health care costs and a deterioration of quality of care due to overcrowding, leading some hospitals to close their emergency rooms and others to turn away ambulances or "dump" patients who still require critical care. Mr. Olson explains that state antidumping laws and the federal COBRA statute have been ineffective at stemming these practices in the face of severe economic pressure to continue them. Pointing out that emergency rooms are an excessively expensive method of treating uninsured nonemergency patients, he proposes a system of primary care clinics created through a public/private partnership between municipalities and existing private health care providers. The partnership is designed to maintain a high standard of care at the clinics. As an incentive to stimulate the appearance of such clinics, a tax would be imposed on private health care providers; the tax on a given provider would be reduced to the extent that provider subsidizes a local primary care clinic that offers universal coverage, regardless of insurance status. Because the existence of such clinics would reduce inefficient use of hospital emergency rooms, in the long run hospitals should find it less expensive to finance local primary care clinics than to continue to sustain unreimbursed expenses due to improper use of their emergency departments.     

Health insurance reform: standard unique employer indentifier. Final rule

This final rule establishes a standard for a unique employer identifier and requirements concerning its use by health plans, health care clearinghouses, and health care providers. The health plans, health care clearinghouses, and health care providers must use the identifier, among other uses, in connection with certain electronic transactions. The use of this identifier will improve the Medicare and Medicaid programs, and other Federal health programs and private health programs, and the effectiveness and efficiency of the health care industry in general, by simplifying the administration of the system and enabling the efficient electronic transmission of certain health information. It will implement some of the requirements of the Administrative Simplification subtitle of the Health Insurance Portability and Accountability Act of 1996.     

Health insurance reform: national standard employer identifier--HCFA. Proposed rule

This rule proposes a standard for a national employer identifier and requirements concerning its use by health plans, health care clearinghouses, and health care providers. The health plans, health care clearinghouses, and health care providers would use the identifier, among other uses, in connection with certain electronic transactions. The use of this identifier would improve the Medicare and Medicaid programs, and other Federal health programs and private health programs, and the effectiveness and efficiency of the health care industry in general, by simplifying the administration of the system and enabling the efficient electronic transmission of certain health information. It would implement some of the requirements of the Administrative Simplification subtitle of the Health Insurance Portability and Accountability Act of 1996.