August 2, 2001

   Mr. PAUL. Mr. Speaker, I thank the gentleman for
yielding me time.

   Mr. Speaker, as you know, I am a physician. I
practiced medicine for more than 30 years, and I can
certainly vouch for the fact that medicine is a mess,
managed care is not working very well; and, hopefully,
we do something good to improve it. Unfortunately, I
am not all that optimistic.

   I support this rule because it is dealing with a
very difficult subject and it brings the Democratic
base bill to the floor. I do not see why we should not
be able to amend that bill, so I do support the rule.

   But the IRS code has 17,000 pages of regulation.
The regulations that we as physicians have to put up
with are 132,000 pages. Most everything I see that is
happening today is we are going to increase those
pages by many more thousands. So I am not optimistic
that is going to do a whole lot of good.

   I think we went astray about 30-some years ago in
the direction of medical care when the government, the
Federal Government, got involved. The first thing is
we changed our attitude and our definition of what
``rights'' are. We call this a Patients' Bill of
Rights. It has very little to do with rights, because
most of what we do in medicine, we undermine
individual rights.

   We have a right in society, in a free society, to
our life and our liberty, and we have a right to use
that liberty to pursue our happiness and provide for
our own well-being. We do not have a right to medical
care. One has no more right to a service than one has
a right to go into someone else's garage and steal an
automobile. So the definition of ``rights'' has been
abused for 30 years, but the current understanding is
that people have a right to services. So I think that
is a serious flaw and it has contributed to our
problem today.

   The other serious flaw that we have engaged in now
for 30 years is the dictation of contract. For 30
years now under ERISA and tax laws, we have forced
upon the American people a medical system where we
dictate all the rules and regulations on the
contracts; and it causes nothing but harm and
confusion. Today's effort is trying to clear this up;
and, unfortunately, it is not going to do much good.

--------------
August 2, 2001

   Mr. PAUL. Mr. Chairman, I appreciate the
opportunity to explain why I oppose all versions of
the Patients' Bill of Rights. Once again Congress is
staging a phony debate over which form of statism to
embrace, instead of asking the fundamental question
over whether Congress should be interfering in this
area at all, much less examine how previous
interferences in the health care market created the
problems which these proposals claim to address.

   The proper way to examine health care issues is to
apply the same economic and constitutional principles
that one would apply to every other issue. As an M.D.,
I know that when I advise on medical legislation that
I may be tempted to allow my emotional experience as a
physician to influence my views. But, nevertheless, I
am acting in the role as legislator and politician.

   The M.D. degree grants no wisdom as to the correct
solution to our managed-care mess. The most efficient
manner to deliver medical services, as it is with all
goods and services, is through the free market.
Economic principles determine efficiencies of markets,
even the health care market, not our emotional
experiences dealing with managed care.

   The fundamental economic principle is that true
competition assures that the consumer gets the best
deal at the best price possible by putting pressure on
the providers. This principle applies equally to
health care as it does to other goods and services.
However, over the past fifty years, Congress has
systematically destroyed the market in health care.
HMOs themselves are the result of conscious government
policy aimed at correcting distortions in the health
care market caused by Congress. The story behind the
creation of the HMOs is a classic illustration of how
the unintended consequences of government policies
provide a justification for further expansions of
government power. During the early seventies, Congress
embraced HMOs in order to address concerns about
rapidly escalating health care costs.

   However, it was previous Congressional action which
caused health care costs to spiral by removing control
over the health care dollar from consumers and thus
eliminating any incentive for consumers to pay
attention to prices when selecting health care.
Because the consumer had the incentive to monitor
health care prices stripped away and because
politicians were unwilling to either give up power by
giving individuals control over their health care or
take responsibility for rationing care, a third way to
control costs had to be created. Thus, the Nixon
Administration, working with advocates of nationalized
medicine, crafted legislation providing federal
subsidies to HMOs and preempting state laws forbidding
physicians to sign contracts to deny care to their
patients. This legislation also mandated that health
plans offer an HMO option in addition to traditional
fee-for-service coverage. Federal subsidies,
preemption of state law, and mandates on private
business hardly sound like the workings of the free
market. Instead, HMOs are the result of the same
Nixon-era corporatist, big government mindset that
produced wage-and-price controls.

   I am sure many of my colleagues will think it
ironic that many of the supporters of Nixon's plan to
foist HMOs on the American public are today among the
biggest supporters of the ``patients' rights''
legislation. However, this is not really surprising
because both the legislation creating HMOs and the
Patients' Bill of Rights reflect the belief that
individuals are incapable of providing for their own
health care needs and therefore government must
control health care. The only real difference between
our system of medicine and the Canadian ``single
payer'' system is that in America, Congress contracted
out the job of rationing health care resources to the
HMOs.

   No one can take a back seat to me regarding the
disdain I hold for the HMO's role in managed care.
This entire unnecessary level of corporatism that
rakes off profits and undermines care is a creature of
government interference in health care. These
non-market institutions and government could have only
gained control over medical care through a collusion
of organized medicine, politicians, and the HMO
profiteers in an effort to provide universal health
care. No one suggests that we should have universal
food, housing, TV, computer and automobile programs;
and yet, many of the poor to much better getting these
services through the marketplace as prices are driven
down through competition.

   We all should become suspicious when it is declared
we need a new Bill of Rights, such as a Taxpayers'
Bill of Rights, or now a Patients' Bill of Rights. Why
do more Members not ask why the original Bill of
Rights is not adequate in protecting all rights and
enabling the market to provide all services? In fact,
if Congress respected the Constitution we would not
even be debating this bill, and we would have never
passed any of the special-interest legislation that
created and empowered the HMOs in the first place!

   Mr. Chairman, the legislation before us is flawed
not only in its effect but in the very premise that
individuals have a federally-enforceable ``right'' to
health care. Mixing the concept of rights with the
delivery of services is dangerous. The whole notion
that patient's ``rights'' can be enhanced by more
edicts by the federal government is preposterous.

   Disregard for constitutional limitations on
government, ignorance of the basic principles of
economics combined with the power of special interests
influencing government policy has brought us this
managed-care monster. If we pursue a course of more
government management in an effort to balance things,
we are destined to make the system much worse. If
government mismanagement in an area that the
government should not be managing at all is the
problem, another level of bureaucracy, no matter how
well intended, will not be helpful. The law of
unintended consequences will prevail and the principle
of government control over providing a service will be
further entrenched in the Nation's psyche. The choice
in actually is government-provided medical care and
its inevitable mismanagement or medical care provided
by a market economy.

   Many members of Congress have convinced themselves
that they can support a ``watered-down'' Patients'
Bill of Rights which will allow them to appease the
supporters of nationalized medicine without creating
the negative consequences of the unmodified Patients'
Bill of Rights, while even some supporters of the most
extreme versions of this legislation say they will
oppose any further steps to increase the power of
government over health care. These well-intentioned
members ignore the economic fact that partial
government involvement is not possible. It inevitably
leads to total government control. A vote for any
version of a Patients' Bill of Rights is a 100 percent
endorsement of the principle of government management
of the health care system.

   Those who doubt they are endorsing government
control of medicine by voting for a modified Patients'
Bill of Rights should consider that even after this
legislation is ``watered-down'' it will still give the
federal government the power to control the procedures
for resolving disputes for every health plan in the
country, as well as mandating a laundry list of
services that health plans must offer to their
patients. The new and improved Patients' Bill of
Rights will still drive up the costs of health care,
causing many to lose their insurance and lead to yet
more cries for government control of health care to
address the unintended consequences of this
legislation.

   Of course, the real power over health care will lie
with the unelected bureaucrats who will implement and
interpret these broad and vague mandates. Federal
bureaucrats already have too much power over health
care. Today, physicians struggle with over 132,000
pages of Medicare regulations. To put that in
perspective, I ask my colleagues to consider that the
IRS code is ``mere'' 17,000 pages. Many physicians pay
attorneys as much as $7,000 for a compliance plan to
guard against mistakes in filing government forms, a
wise investment considering even an innocent mistake
can result in fines of up to $25,000. In case doctors
are not terrorized enough by the federal bureaucracy,
HCFA has requested authority to carry guns on their
audits!

   In addition to the Medicare regulations, doctors
must contend with FDA regulations (which delay the
arrival and raise the costs of new drugs), insurance
company paperwork, and the increasing criminalization
of medicine through legislation such as the Health
Insurance Portability Act (HIPPA) and the medical
privacy regulations which could criminalize
conversations between doctors and nurses.

   Instead of this phony argument between those who
believe their form of nationalized medicine is best
for patients and those whose only objection to
nationalized medicine is its effect on entrenched
corporate interests, we ought to consider getting rid
of the laws that created this medical management
crisis. The ERISA law requiring businesses to provide
particular programs for their employees should be
repealed. The tax codes should give equal tax
treatment to everyone whether working for a large
corporation, small business, or self employed.
Standards should be set by insurance companies,
doctors, patients, and HMOs working out differences
through voluntary contracts. For years it was known
that some insurance policies excluded certain care.
This was known up front and was considered an
acceptable practice since it allowed certain patients
to receive discounts. The federal government should
defer to state governments to deal with the litigation
crisis and the need for contract legislation between
patients and medical providers. Health care providers
should be free to combine their efforts to negotiate
effectively with HMOs and insurance companies without
running afoul of federal anti-trust laws--or being
subject to regulation by the National Labor Relations
Board (NLRB).

   Of course, in a truly free market, HMOs and
pre-paid care could and would exist--there would be no
prohibition against it. The Kaiser system was not
exactly a creature of the government as it the current
unnatural HMO-government-created chaos we have today.

   Congress should also remove all federally-imposed
roadblocks to making pharmaceuticals available to
physicians and patients. Government regulations are a
major reason why many Americans find it difficult to
afford prescription medicines. It is time to end the
days when Americans suffer because the Food and Drug
Administration (FDA) prevented them from getting
access to medicines that where available and
affordable in other parts of the world!

   While none of the proposed ``Patients' Bill of
Rights'' addresses the root cause of the problems in
our nation's health care system, the amendment offered
by the gentleman from Kentucky does expend individual
control over health care by making Medical Savings
Accounts (MSAs) available to everyone. This is the
most important thing Congress can do to get market
forces operating immediately and improve health care.
When MSAs make patient motivation to save and shop a
major force to reduce cost, physicians would once
again negotiate fees downward with patients--unlike
today where the reimbursement is never too high and
hospital and MD bills are always at the maximum levels
allowed. MSAs would help satisfy the American's
people's desire to control their own health care and
provide incentives for consumers to take more
responsibility for their care.

   There is nothing wrong with charity hospitals and
possibly the churches once again providing care for
the needy rather than through government paid programs
which only maximizes costs. States can continue to
introduce competition by allowing various trained
individuals to provide the services that once were
only provided by licensed MDs. We don't have to
continue down the path of socialized medical care,
especially in America where free markets have provided
so much for so many.

   In conclusion, Mr. Chairman, I urge my colleagues
to reject the phony Patients' Bill of Rights which
will only increase the power of the federal
government, cause more Americans to lose their health
care or receive substandard care, and thus set the
groundwork for the next round of federal intervention.
Instead. I ask my colleagues to embrace an agenda of
returning control over health care to the American
people by putting control over the health care dollar
back into the hands of the individual and repealing
those laws and regulations which distort the health
care market. We should have more faith in freedom and
more fear of the politicians and bureaucrats who think
all can be made well by simply passing a Patients'
Bill of Rights.

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