Arizona Rep. John Shadegg exposes provision in health bill worth millions to demonized insurance companies
You might have to watch this one twice. I did. This is a bit confusing to follow, but I’m going to break it down as best I can when I have some time soon. In the meantime, it’s just another example of how health care reform is being sold as one thing, but in reality is a completely different animal.
UPDATE: So, I asked an acquaintance of mine who handles ERISA law for a big firm here in the northeast about the significance of Shadegg’s discovery. After all, I understood the basics of what the congressman was saying, but I didn’t understand well enough to instruct others. While my friend here is a closet conservative and a possible congressional candidate himself in the near future, I can’t give his name at this point. Nevertheless, here’s the note I received from him:
Wow. I hadn’t heard of this until you pointed out the video, but this is pretty significant. While I don’t want to put words in the mouth of Congressman Shadegg, I think I can explain what he was getting at.
Under the decisions in Pilot Life Ins. Co. v. Dedeaux and Corcoran v. United Healthcare Inc., ERISA preempts any and all state laws which would otherwise grant a right of recovery to those injured by the negligent or even intentional denial of medical care coverage by an HMO or insurance carrier.
The result in Corcoran was that the Corcorans were held as preempted from seeking damages under Louisiana state law from the insurance company for the grossly negligent decision to ignore not only the Corcorans’ doctor’s advice, but their own expert witness doctor’s advice, which was to immediately hospitalize the expectant mother. Ignoring that advice resulted in the death of the Corcoran’s baby. The most that ERISA would allow as a recovery in federal court is the cost (or value) of the care or coverage denied.
From what it looks like in this bill, this same preemption is preserved, but only if the persons insured do not have coverage from a non-federal source, such as a private insurance company. (Until those are inevitably forced out of the marketplace.) In other words, without the federal health care “public option,” persons suffering from the death of a child because of care denied would share the same fate as the Corcorans: preemption of state law rights to sue for damages and a cap on any federal recovery limited to the cost of the care denied.
But if the new health care reform bill passes, and the insureds get (or are forced to get) their insurance from the government’s planned “Health Insurance Exchange,” then the previously-existing ERISA preemption of state laws is lifted, and wrongful death and damages actions under state law above and beyond the mere cost of coverage denied against ERISA-covered HMOs and insurance companies will no longer be precluded. The sky’s the limit. Perhaps this is why the trial attorneys have been so silent about opposing the federal healthcare takeover?
While it might be argued that this lifting of the ERISA preemption is a “good” thing, by conditioning it upon and coupling it with the federal takeover of the nation’s private healthcare system, Nancy Pelosi and the Democrats practice the worst form of hypocrisy. Rather than simply fixing the preemption effect of ERISA as laid down and confirmed in Pilot Life, which Congress could do at any time, the proposed legislation seeks to bribe the personal injury tort bar into silence in order to increase the chances for passage.
One other thing. People need to understand that simply reading the 1,900 pages in the new bill doesn’t even come close to quantifying the number of pages of laws people would need to read in order to get the full picture. Every time one of these bills makes reference to some other law, unless a reader goes to that other law and examines exactly what that law says, it is difficult if not impossible to understand what exactly the bill incorporating and referencing it is proposing.
I’ve not tried to ascertain how many additional pages of laws so incorporated and referenced one would need to read to get a clear picture, but my guess would be at least ten times as many pages as the host bill. Therefore, in order to understand what the Pelosi bill really means, instead of 2,000 pages or so, you should be prepared to read roughly 20,000 pages of already-existing law. In 72 hours before the vote, of course. And, barring a 400-page amendment dropped at the last moment, you’ll be done.
Bottom line, though, is that this bill is an absolute wonderland of horrors. If it passes, America as we know it is in a world of trouble. Meanwhile, I hope my explanation helped.