Is medical protection needed? Props 214 and 216 explained

There are two items on the ballot today that have quite possibly gone unnoticed or not understood. This article will attempt to alleviate some of that unfamiliarity.

Proposition 216, patient protection and Proposition 214, health care consumer protection, both deal with doctor and patient relationships regarding HMO medical plans.

Both measures eliminate bonuses to physicians who withhold treatment or give referrals. Both ban HMO plans from limiting what doctors may or may not tell patients, regarding their health. This is the so-called gag rule that has been discussed when referring to this proposition.

It allows doctors to give patients information about their health, beyond what they are seeking. It also allows doctors to refer patients to a specialized physician, if they feel the patient's needs would be better accommodated by another doctor.

The proposition duo also affords patients a right to a second opinion and sets standards for levels of staff on-hand at hospitals and nursing homes. Currently, no standard employee-patient ratio exists at hospitals.

However, there are minimum staff requirements at nursing homes, according to the California Ballot Pamphlet. State law requires nursing homes to have at least one registered nurse per shift and sets nursing assistant staff requirements according to the number of patients on hand.

Aside from these similarities, the two propositions take separate paths. Prop 216 initiates four taxes on HMO practices. Tax one is for eliminating hospital beds. For each bed eliminated at a nursing care facility, one percent of the business average per-bed gross would have to be paid for five years.

Tax two is for excessive CEO salaries. This imposes a two and a half percent tax on the value of any new stock or other securities provided as payment to officers of, employees of or consultants to private health care businesses or suppliers.

Tax three is for mergers and acquisitions. This imposes a one-time, 1 percent tax on the value of any California assets involved in mergers or acquisitions of health care businesses as well as a 3 percent tax on the gross revenue of newly-formed multi-provider networks (health care businesses that jointly provide services) which would be paid for the first five years of the life of the business.

Tax four is for converting a health-care enterprise from a non-profit to a for-profit organization. This imposes a 10 percent tax on the sale, lease, transfer or conversion of any non-profit health care business or provider of health care supplies or services to a for-profit business, according to the California Ballot Pamphlet.

The funds from the taxes stemmed by Prop 216 would go directly to a new public agency that would monitor the health care system and support the general consumer. It would involve maintaining trauma care, health care for seniors and public health services, as well as other health measures.

In summary, Prop 216 acts as a sort of watchdog for the consumer, requiring physical exams before physicians can deny medical attention and prohibiting financial incentives for reducing care to patients.

Supporters of 216, including the California Nurses Association, Green Party presidential candidate, Ralph Nader and the American Public Health Association, say this initiative is all about consumer protection and that it sets tough, much needed standards and enforcement provisions on the health care industry.

The Prop 216 campaign is a "major juncture in the history of health care in the United States," Nader said. "It is time for someone to say no to a powerful economic interest that upsides greed while downsizing care and treatment."

Opposers of this proposition, including Sisters of Mercy, the California Taxpayers Association and the California Chamber of Commerce, argue that 216 is phony health care reform; that the measure would not only create new taxes but that it would also hike insurance costs.

On the other hand, Prop 214, sponsored by the Service Employees International Union, employs no new taxes on HMOs. It does, however, set standards for the health care industry, set staffing requirements and demand physical examinations prior to care.

Supporters of 214 say the measure, like 216, prevents HMOs and insurers from using gag rules, intimidation or financial incentives to discourage physicians from providing further medical care. They also say it imposes no new taxes, unlike 216.

Opposers of 214 argue that the measure will increase health-care costs. They say the measure will add unnecessary staff and will set unneeded administrative requirements.

In general, the two propositions are extremely similar, with the exception of the 216 tax.

Backers of the two propositions say that the measures are necessary.

"These bills are a step in the right direction," said Myra Snyder, president and CEO of the California Association of HMOs. "Our mission is to encourage high quality, cost effective health care and we are pleased to see legislation that protects consumers this way."

Antagonists of the proposition duo argue that HMO fees will skyrocket if the two measures pass because of hidden costs that will come from the state and local governments' costs of directly operating these health care programs: probably in the range of tens of millions to hundreds of millions of dollars, annually, according to the California Ballot Pamphlet.

"What people are left with are proposals that will force health care costs skyward, which, in turn, will leave more people unable to afford health insurance and not improve access or coverage," said C. Duane Dauner, president of the California Health Care Association and co-chairperson of the Taxpayers Against higher Health Costs campaign to defeat props 214 and 216. "Californians surely don't want or need this kind of health care reform."