Press Briefing by Secretary of Health and Human Services Donna Shalala, Secretary of Labor Alexis Herman

The Briefing Room

1:10 P.M. EST

MR. TOIV: Good afternoon, everyone. Before Mr. McCurry comes out for his daily briefing, we have the co-chairs of the Advisory Commission on Consumer Protection and Equality in the health care industry who can answer any questions you might have on the President's call -- Secretary Shalala and Secretary Herman are here to answer any questions you might have on the President's call this morning for a Consumer Bill of Rights and Responsibilities. Glad to take your questions.

SECRETARY SHALALA: Thank you very much. Questions?

Q: How quickly are you going to move to implement the rights under respective departments -- how quickly can you move?

SECRETARY HERMAN: Well, I think the -- on two fronts. Obviously, the announcement this morning by the President that the GTE Corporation has already endorsed the Bill of Rights and Responsibilities and that Bill of Rights will now apply to more than 400,000 participants in the GTE employer family system indicates that from a voluntary standpoint point of view, that clearly employers and others can start to move out right away.

The President directed all of the executive branches now to go back and to examine what is in the Bill of Rights and Responsibilities and to report back to him on what we can do to take action on what has been presented. I would assume that we can begin to do some things right away because you don't need --

SECRETARY SHALALA: Well, in fact, the Medicare program already contains a lot of these rights already, so what we need to do is to go systematically through our programs. Now, this involves the Department of Defense programs, the Veterans Administration programs, as well as HHS and whatever appropriate responsibilities that the Labor Department has. We expect to report back to the President sometime in February.

Q: Secretary Shalala, with all these recommendations that the President has embraced, should they become law, how are you going to prevent a litigation explosion?

SECRETARY SHALALA: Well, I think that the point is to avoid a litigation explosion. If you look, for instance, at making certain that appeal rights are within a health plan or a hospital and making sure that people know what those rights are and that they try to settle whatever concerns they have within their own health plan or within their hospital or nursing home, and if they can't a very small number will go to an outside system set up by the states. I mean, the point of all of this is to make sure that the information is there so that people are clear about what their plan offers and to reduce litigation. In fact, I'd argue that this is moving in the other direction, to reduce legislation.

SECRETARY HERMAN: I think it's important to point out that we actually heard testimony on this yesterday in the commission meeting, and one of the clear indications is that when consumers have information, when they know their rights and they're able to get the information that leads to better quality, that leads to more efficient systems, that the reality is you can in fact reduce the burdens of litigation on any one system.

Q: So somebody who doesn't -- because one of the appeals essentially says if I don't like the way I'm being treated I can appeal this process, but eventually something like that could lead to litigation. If you don't feel you're getting a respectful quality of care or whatever and the providers --

SECRETARY HERMAN: But you can do that now. I mean, an individual, technically, could proceed down a path of litigation right now without having, quite frankly, the information that they're trying to essentially get oftentimes through a litigation process that now this Bill of Rights calls for in terms of disclosure.

Q: Secretary Herman, do you support what's in the Charlie Norwood's bill that would allow consumers to sue plant managers if they make a medical decision that goes bad on them?

SECRETARY SHALALA: We haven't taken a position on any of the legislation. We will use this Bill of Rights as a framework to examine that legislation. But in addition to that, we're talking about some of this could be incorporated as part of an accreditation processes. We're looking at our own regulations; some of it may be voluntary, as we saw today with the GTE company.

Q: Is that something the administration is planning to act on and will you take a position on this bill eventually?

SECRETARY HERMAN: Presently, the administration has taken no position. Obviously, the administration is looking at all of the various proposals that are presently being debated on the Hill, but we have not taken any position to date yet.

Q: You just mentioned that some of this can be done through the private accreditation process. But what parts of the bill of rights do you think will have to be legislated to guarantee that Americans are protected by these provisions?

SECRETARY SHALALA: Well, we will, in fact -- the President has now asked us to do that review. I know of one piece now -- privacy. We have privacy proposals up before Congress, and I think everyone would say that using health care records for health purposes and making sure we have privacy protections.

We have no federal privacy protections for health care information now in this country. There are more protections on your Blockbuster card and on your motor vehicle license than there are on your health care card. There is one pretty narrow example. But that's the only one that comes to mind, and we will be going through a review.

Q: Is it right to look at this bill of rights as kind of a minimum national set of standards that states can go further, if they wish?

SECRETARY HERMAN: I don't know that I would use the term, necessarily, minimum set of standards. What I think we have here are a set of operating principles that we're saying all consumers are entitled to, in terms of their basic fundamental rights in the health care system.

And I think of it more in terms of a clear set of operating principles that we've laid out for states, for Congress, for employers, for everyone who is a stakeholder in this issue to hopefully adopt.

Q: If a state wants to pass laws setting higher standards than this panel recommended, there's nothing that would discourage them from that?

SECRETARY HERMAN: Well, clearly, I think, you have states that are already taking the lead in different ways in this area that certainly we would want to encourage and see how the states follow.

We had testimony in this commission meeting on various states, for instance, who were doing things differently in the complaints and appeals process. I think New Jersey is a good example of that.

Q: What do you say to the one dissenting member of the commission, who contended that these recommendations would cost small businesses too much and could lead to them dropping coverage of their employees?

SECRETARY SHALALA: You're a former small business owner, so why don't you answer that?

SECRETARY HERMAN: I think certainly we heard the sentiments that were expressed by our commission member regarding her own point of view. One, I point out that there clearly were other small business members on this commission who, in fact, did endorse the recommendations as well as the cost estimates that were provided to the commission members, and they certainly recognized and believed that the proposals that were being made were proposals that needed to be made, that the costs were very much in line with what we were proposing and that small businesses could deal with, and the other reality is that sometimes when you put more efficient systems in place, it actually can lead to cost reduction. I think that was left out of the debate.

And I can just say as a former small business owner myself, this was an issue that I was particularly sensitive to as we went through the discussions because many of those individuals that we certainly want to take advantage of these recommendations are, in fact, small businesses. It's the employers. Most people get insurance today in the workplace, and so for us to be sensitive to the needs of small business was very much a guiding principle throughout these discussions.

SECRETARY SHALALA: I would look at it slightly in an additional way, and that is that every health plan, every hospital, every nursing home adopts the Consumer Bill of Rights, whether it's a combination of accreditation and licensing or state regulations or whatever way they get it, it empowers a small business, because it gets them something they can't get now because they're too small of a purchaser.

So one way of looking at this is that for small businesses, for them to be able to get this kind of information and appeals processes for their employees, they can't do it as a small business. But if we get it into all the plans and all the other parts of the health care system, they get it along with everybody else. So we think, in fact, it strengthens the hands of all businesses in this country for their employees.

SECRETARY HERMAN: But I'd say especially small businesses when we talk about strengthening the hand of employers.

Q: But do you reject the argument that this will raise costs?

SECRETARY HERMAN: We don't reject that. As a matter of fact, we had proposals presented to the commission yesterday that, in fact, stated we believe a very modest cost figure.

SECRETARY SHALALA: The average cost was .84. What the quick and dirty study that Lewin and Associates, which was reconfirmed by one of the business leaders at the table who had done a similar study, Randy McDonald from GTE reported they had done a similar study -- the average cost was .84 per health care -- per consumer, per month, .84 per month.

But remember that this commission is not just about consumer rights, it's also about quality. What we're trying to do is to make the whole health care system more efficient. The more information you have, the more effectively you use the system, the more you reduce the amount of litigation so that on the one hand providing these rights, access to information, may initially cost more depending on how much you're doing now -- and most plans are doing some of this -- and the best plans are doing almost all of it.

But on the other hand, anything we can do to use the health care system more efficiently in terms of us having more information about the doctors, about the companies we're going into will also save money. So I think that it would be misleading to the American public to see this just as an add-on as opposed to part of a fundamental change in the American health care system. This is the consumer rights piece; we'll be talking in March about the quality piece, which is a very different way of running and managing the health care system in the United States.

Q: Secretary Shalala, the President's pointed out recently that in the three years since the defeat of this universal health care plan, the number of Americans without health insurance has steadily climbed and I believe is now over $40 million. Does this bill of rights do anything to arrest and reverse that trend?

SECRETARY SHALALA: In two ways it will be helpful, but it doesn't directly address the access question. Number one, this bill of rights applies to everyone who uses the health care system whether or not they have health insurance. So if they walk into an emergency room, if they go pay a doctor out of pocket, or go into a hospital, it applies to them. That's number one.

Number two, to the extent that the health care system is more efficient and that we can contain the growth of health care costs, not just in the Consumer Bill of Rights, which allows us to use it more effectively, but in the quality recommendations we'll be making, to the extent that people go to surgeons, for instance, that have done the surgery a lot of times, where they're not only producing more quality, but probably a better cost in the long run, it will affect access to health care in the United States.

But this administration has addressed that issue in a variety of different ways, including the Kennedy-Kassebaum bill on the issues of discrimination and the children's health insurance which will reduce those numbers by at least 5 million.

SECRETARY HERMAN: I would also add to that, though, in relationship to the bill of rights, that I really do believe that by making the system more efficient and by enabling more employers, particularly again as we look at what we can do for small businesses through the recommendations that have been made in this bill, that we help those units in particular to be able to consider, perhaps, because of more efficiency in the system covering additional workers. And in that context, hopefully we can bring more individuals into the system.

Q: You were asked which of these provisions would have to be legislated. Sort of the outburst of that -- are there any provisions that you know at this point or can indicate at this point can be implemented without any legislation?

SECRETARY SHALALA: All of them can. All of them can if hospitals and nursing homes and --

SECRETARY HERMAN: Employers --

SECRETARY SHALALA: -- and employers decide to adopt them. If the purchasers of health care, including the federal government, say we're not going to purchase health care unless we have all these Consumer Bill of Rights, all of them can. The most important thing is to get them for everybody, and that's why there's a consideration of accreditation regulation legislation.

SECRETARY HERMAN: And I think to the extent that we have to look at nonvoluntary action, if you will, in this area, it will be related to the need for consistency for all consumers in this area, because clearly you already have some very good HMOs that are doing disclosure, that are providing the kind of information that we're asking for through this Bill of Rights. But not everyone is doing that, so we're concerned about, I think, consistency of effort in this Bill of Rights.

SECRETARY SHALALA: As we leave here, think about in your own health care plans how many of you know, have background information on your doctors in your own health care plans, and how many of you know what rules apply if you disagree with a decision made by your health plan? How do you appeal that process?

When we're finished with this, every single one of you will clearly know that information. That is the fundamental point. We want you to know more about your health care plan to be able to use it more effectively.

Q: Thank you.

SECRETARY HERMAN: Thank you very much.

END 1:30 P.M. EST