Toward a New
Health Care System
An ACLU Public Policy Report
AMERICAN CIVIL LIBERTIES UNION
132 West 43rd Street
New York, NY 10036
122 Maryland Avenue, N.E.
Washington, DC 20002
Nadine Strossen, President
Ira Glasser, Executive Director
Laura Murphy Lee, Director, Washington Office
Kenneth B. Clark
Chair, National Advisory Council
Copies of Toward a New Health Care System: The Civil Liberties Issues
are available for $5.00 each. Send check/money order to:
ACLU Dept. L
P.O. Box 794
Medford, NY 11763
Copyright 1994 American Civil Liberties Union All Rights Reserved.
The American Civil Liberties Union is a nationwide, nonpartisan
organization of 275,000 members dedicated to preserving and defending the
principles set forth in the Bill of Rights.
THE HEALTH CARE REFORM BILL OF RIGHTS
ARTICLE I > EQUAL PROTECTION
Universal Coverage > All persons residing in the United States shall have
the right to receive adequate, accessible and affordable health care
services throughout their lives, without interruption.
Health Care Benefits > An adequate health care system is one that
guarantees a comprehensive package of health care benefits consonant with
an individual's basic health needs. The package must include
comprehensive preventive services, reproductive services and services for
individuals with disabilities.
Financing > The costs of financing the health care system shall be
distributed equitably, taking account of differences in ability to pay.
All poor and nearly poor persons shall be eligible for subsidies and cost
reductions, regardless of the source of their income.
Remedies for Discrimination > The reformed health care system shall prohibit
all forms of invidious discrimination in the delivery of health care, and
shall provide remedies for violations thereof.
ARTICLE II > PERSONAL PRIVACY
Personal Autonomy > The health care system shall respect a person's right
to autonomy in decisions concerning medical treatment, including matters
of reproductive choice.
Privacy of Medical Information > Access to and disclosure of individually
identifiable health information shall be strictly limited; no disclosure
shall be permitted without an individual's uncoerced, informed consent.
All individuals shall have a right o f access to their own records,
including the right to copy and correct any and all information contained
National Health Card > Health care reform must not lead, directly or
indirectly, to the establishment of a national identity card or any other
card that provides the basis for discrimination, or that undermines the
privacy of personal information.
ARTICLE III > DUE PROCESS OF LAW
Consumer Information > All persons shall have the right to receive
information about their health care rights, options and responsibilities
that is thorough, understandable, accessible and timely.
Access to Justice > All persons shall have the right to obtain redress for
violations of their rights in the health care system. Procedures for
enforcing these rights shall be designed to yield fair and accurate
results in a timely fashion.
Government Enforcement Programs > The government shall afford all persons
due process in any civil or criminal proceeding to enforce
responsibilities under health care reform.
ARTICLE IV > FREEDOM OF RELIGION AND SPEECH
Right to Opt Out > Individuals whose moral convictions or religious
beliefs forbid them from accepting medical treatment shall not be
compelled to participate in the health care system.
Conscience Clause > No individual health care provider shall be compelled to
perform medical procedures that violate her personal religious beliefs or
Freedom of Speech > No health care provider shall be excluded from
participating in the health care system based upon her political beliefs,
nor shall any restriction of her free speech rights be imposed as a
condition for participation.
TABLE OF CONTENTS
HEALTH CARE REFORM BILL OF RIGHTS
I. EQUAL PROTECTION
A. UNIVERSAL COVERAGE
1. Enrollment (non-citizens, prisoners, Native Americans)
2. Accessibility and Affordability (accessibility, affordability,
B. HEALTH CARE BENEFITS
1. Comprehensive Benefit Package (mandatory provision of the
comprehensive benefit package, medical necessity or appropriateness,
preventive services, women's health, services for individuals with
2. Supplemental Benefit Programs (home and community-based
services for individuals with disabilities, Medicaid)
C. FINANCING HEALTH CARE REFORM
D. TRANSITIONAL INSURANCE REFORM
E. REMEDIES FOR DISCRIMINATION
1. General Requirements (covered entities, prohibited
discrimination, standard for discrimination, affirmative action,
enforcement provisions, applicability of existing anti-discrimination
2. Alliance Boundaries
II. PERSONAL PRIVACY
A. PRIVACY OF MEDICAL INFORMATION
1. Medical Records Confidentiality
2. National Identifier/Social Security Number
3. Financing and Intra-Family Privacy
B. NATIONAL HEALTH CARD (discrimination, national identity card, privacy)
III. DUE PROCESS
A. CONSUMER INFORMATION (selection of health plan, health plan
information for enrollees, applications for premium discounts and reduced
cost-sharing, rights of veterans, Native Americans and members of military
B. ACCESS TO JUSTICE
1. Substantive Remedies for Enforcing Rights (claims for payment
or provision of benefits, enforcement of rights against states and
alliances, enforcement of rights against health plans, enforcement of
rights against the federal government, declaratory judgments)
2. Fair Administrative Procedures (health plan claims procedure,
miscellaneous remedial provisions)
3. Judicial Review
4. Attorneys' Fees
5. Medical Malpractice Reform (overbroad definition of medical
malpractice claim, authorization for more restrictive state laws,
mandatory alternative dispute resolution, certificate of merit
C. GOVERNMENT ENFORCEMENT PROGRAMS
1. Civil Enforcement Measures (civil monetary penalties,
disqualifications, collection practices, misdirected sanctions)
2. Federal Criminal Enforcement (creation of new federal crimes,
expansion of criminal forfeiture)
IV. FIRST AMENDMENT FREEDOMS
A. FREEDOM OF RELIGION (the right to opt out of the health care system,
B. FREEDOM OF SPEECH (marketing practices, statutory protections for
The United States confronts a crisis in health care. Our current system
denies health care to millions of people, provides inadequate care to
millions more and threatens untold numbers of others with loss of health
insurance coverage due to employment, domestic or other life changes. Our
government is, therefore, considering comprehensive reform. Even though
the United States Constitution, as currently understood, does not
guarantee a right to adequate health care, government reform of health
care implicates an individual's constitutional rights to life, liberty
and property at every turn.
Health care reform can strengthen our civil liberties. By
correcting the deficiencies of the current system, the government's reform
effort offers prospects for improved protection of individual rights,
increased personal autonomy and greater equality o f opportunity. If not
properly designed, however, health care reform could pose many threats to
due process, privacy and equal protection rights, as well as to First
The American Civil Liberties Union (ACLU) believes that once the
government undertakes to provide a system of health care, which is
recognized the world over as a basic necessity of life, the Constitution
requires that all persons be given fair and equitable access to adequate
care. Therefore, we support and call for health care reform legislation
that advances civil liberties and civil rights. The ACLU intends to
remain an active participant in the debate surrounding health care,
sensitizing the public and Congress to the relevant civil liberties
Congress is presently considering several legislative proposals
for health care reform. These proposals range from the creation of a
national, single-payer system, to various forms of "managed competition,"
to modest health insurance market reform. Each proposal raises
different, though related, civil liberties concerns. This report focuses
solely on the Health Security Act, S. 1757 and H.R. 3600, the Clinton
Administration's health reform plan.
Under the President's proposal, the country would be divided into
regional "health alliances," one or more in each state. An alliance would
negotiate health insurance premiums with a variety of "health plans," each
of which would be required to offer a "comprehensive benefit package" of
services. A range of health plans, including both managed care and
fee-for-service plans, would be available in each alliance. Once a year,
a family would choose a health plan from among those offered in its
vicinity. Large corporations could continue to offer their own health
plans to their employees, so long as those plans included the
comprehensive benefit package. The military, the Department of Veterans
Affairs and the Indian Health Service would also continue t o offer
separate health programs. All employers would be required to contribute
to their employees' health care costs. In general, employers would have
to pay 80 percent of the cost of an average priced health plan, while
employees would be responsible for the remaining cost of the premium for
the plan they select. The federal government would help subsidize the
cost of coverage for small employers, low-income individuals and families
and recipients of Aid to Families with Dependent Children (AFDC) or
Supplemental Security Income (SSI).
The ACLU describes herein those aspects of the President's program
that would provide greater protections for the rights of people in this
country, and those aspects that give rise to civil liberties concerns.
Ours is not an exhaustive study of the Health Security Act, a proposal of
great scope and complexity that runs to 1,364 pages, includes 11 titles
and has well over 500 sections. Rather, in the course of our analysis we
have sought to illuminate the major civil liberties principles that are at
stake in the health care debate, and that any reformed health care system
This report, prepared by the ACLU's national offices in New York
and Washington, D.C., is divided into four sections. Each section
corresponds to one of the major civil liberties principles implicated by
health care reform: equal protection, personal privacy, due process of
law, and the First Amendment freedoms of religion and speech.
I. EQUAL PROTECTION
One of the central constitutional issues raised by health care
reform is that of equal protection. Equal protection concerns arise
whenever the government provides services or benefits to some of its
constituents to the exclusion of others. Where the government undertakes
to provide universal and comprehensive health care, it is required to
implement that health system consistent with equal protection principles.
In general, equal protection requires that the government treat
people equitably: If people are similarly situated, the government should
treat them the same; if their circumstances differ in relevant respects,
the government may need to address their situations differently in order
to yield comparable treatment. In health care reform, equal protection
concerns are raised by the issues of universal coverage, comprehensive
benefits, and financing, among others. While in many respects, the Health
Security Act would provide far more equitable treatment than our present
health care system, the proposed legislation nevertheless creates some
sharp inequities that must be addressed.
A. UNIVERSAL COVERAGE
The Health Security Act identifies universal coverage as one of
the cornerstones of a reformed health care system: "Health insurance and
high quality health care should be secure, uninterrupted, and affordable
for all individuals in the United States." Section 2(2)(A). The very
first part of the first subtitle of the Act's first title is headed
The basic point of universal coverage is to provide quality health
care to all. However, this principle is not satisfied simply by ensuring
that all individuals are enrolled in a health care program. True
universal coverage requires that health service s be accessible and
The Health Security Act goes far toward satisfying the principle
of universal coverage. Nevertheless, some groups -- notably many
non-citizens and prisoners -- would remain outside of, and underserved by,
the proposed health care system. Moreover, serious questions arise as to
whether the Act would ensure meaningful access to health services in
underserved communities, and whether the cost of care under the plan would
prevent many poor people from obtaining necessary treatment.
Under the Health Security Act, virtually all people in the United
States would be enrolled in health plans offering a comprehensive package
of benefits. The Act would extend coverage to the vast majority of the 37
million people who are currently uninsured, including many of the poor
and the near poor. In addition, by eliminating waiting periods and
coverage restrictions based on pre-existing conditions, the Act would
ensure that most people remain covered throughout their lives, without
risking the loss of health services by virtue of employment, domestic or
other changes in their lives. The ACLU supports these expansions of
health care coverage as meaningful progress toward guaranteeing access to
adequate health care for all persons in the United States.
Unfortunately, the Health Security Act unjustifiably excludes
several groups from the promise of universal coverage, in particular
certain non-citizens and prisoners.
Non-citizens > The Health Security Act does not limit its coverage
to U.S. citizens, but it does exclude a significant portion of the
immigrant community. Under the Act, only long-term non-immigrants, lawful
permanent residents, and certain categories o f aliens permanently
residing in the U.S. under color of law are eligible to enroll in health
plans. Section 1001(c)(2) & (3). Excluded from coverage are all
undocumented persons (including children and pregnant women), plus many
aliens permanently residing in the U.S. under color of law.
By excluding such individuals, the Act not only fails to achieve
truly "universal" coverage but actually takes a significant step
backwards. Many of these individuals currently receive health coverage
through private insurance, employer plans or existing state and federal
health programs. The Clinton proposal would relegate these individuals to
emergency hospital services and health services from a limited number of
"qualified community health groups," see sections 3421-29.
Prisoners > Prisoners are also excluded from the health care
benefits conferred by the Health Security Act. Section 1001(e)
specifically provides that prisoners are entitled only to the "health care
services provided by the authority responsible for the prisoner," and not
to the comprehensive benefit package available to all eligible individuals
through enrollment in health plans. In the ACLU's view, the comprehensive
benefit package (discussed below) defines a floor for adequate health
services that should be provided to all.
In the ACLU's view, the Act's exclusion of aliens and incarcerated
prisoners is inequitable and inconsistent with the principle of
comprehensive care that informs the President's proposal. As public
health specialists recognize, excluding any group from coverage is not
sound medical policy and will put all of us at greater risk of contracting
contagious diseases. Furthermore, one of the basic premises of the Health
Security Act is that the overall cost of health care can be sharply
reduced by encouraging people to seek clinical preventive services
regularly and to obtain treatment for illness promptly, rather than
waiting until medical problems escalate and require emergency attention.
Yet the latter track is precisely the one to which many immigrants would
be driven, resulting in enormous additional costs -- especially for cities
and states. Similarly, it is not rational to exclude from coverage
incarcerated prisoners who will have been eligible for health care prior
to incarceration, and will regain eligibility as soon as they are
released. Continuity of care for these persons is no less important than
continuity of care for all others, and health care provided to them will
be more efficient, cost-effective and protective of the public health if
not interrupted or reduced during their incarceration.
Native Americans > Native Americans are also threatened with
inadequate coverage under the enrollment provisions of the Health Security
Act. Section 8302(b) offers Native people an apparent choice between
enrolling in a health plan or electing to receive health services through
one of the health programs of the Indian Health Service (IHS) -- programs
that are explicitly not defined as health plans under the Act. However,
Native Americans will have a strong financial incentive to choose a free
IHS health program, section 8302(c), rather than a health plan with its
applicable premiums, deductibles, coinsurance, or co-payments, section
This would be unobjectionable if IHS programs provided health
services comparable to regional alliance health plans, but they do not.
Although the Health Security Act requires IHS health programs to provide
the comprehensive benefit package to their enrollees, section 8304(a),
the effective date for this requirement is delayed until 1999 -- most
likely out of a recognition that IHS programs are ill-equipped to offer
such services today. If Native Americans will be driven toward receiving
their health c are through the IHS, protections must be written into the
Act to ensure that IHS health programs provide them with care comparable
to what is being provided to others.
2. Accessibility and Affordability
From the equal-protection perspective, it is not enough that a
reformed health care system guarantee adequate health care to all
Americans on paper. Unless health care services are both accessible and
affordable, many people will continue to be deprived of care. The Health
Security Act incorporates a number of provisions designed to increase
access to health care in underserved communities and to reduce the cost of
health care for the poor. Nevertheless, the ACLU believes that more is
required to ensure that all eligible individuals will have meaningful
access to health services.
Accessibility > Section 1203(e)(1)(A)(i) of the Act requires
states to ensure that all eligible families have "adequate access to
enroll in a choice of regional alliance health plans providing services in
the area in which the individual resides." To accomplish this end, states
may require certain health plans to "cover all (or selected portions) of
the alliance area." Section 1203(e)(1)(B). Moreover, all health plans
will be required to contract for five years with Essential Community
Providers in their service area, section 1431; Essential Community
Providers are health care professionals and institutional providers who
serve medically underserved populations or areas. Section 1583. In
addition, the Act creates, or permits states to offer, a variety of
incentives to encourage health plans and/or providers to offer health
services in underserved communities.
The ACLU believes that provisions of this sort are essential steps
toward ensuring meaningful access to health care. Nevertheless, the ACLU
has serious questions about whether the Act will lead to adequate
provision of health services in currently under served communities. The
nation's current system of health care in America is marked by broad
inequalities of treatment that relate to race and economic status. The
Act does not take sufficient steps to redress this pervasively
discriminatory pattern. N or does the Act establish any standards to
define what it means for a health plan to "serve" an area.
Many mechanisms provided by the Act ostensibly to encourage the
delivery of medical care to underserved areas are matters of state
discretion. One state may provide incentives to assure services to its
medically needy, while comparable needs in neighboring states go
unaddressed. Nor are there any assurances that the various financial
incentives (even if offered and fully funded) will be sufficient to bring
adequate numbers of health care providers to underserved communities. At
a time when our nation' s inner-city infant mortality rate is higher than
that in many developing nations, the ACLU believes it imperative for the
Act to incorporate meaningful standards -- as well as explicit legal
remedies -- to ensure that there will be real access to all health care
items and services included in the comprehensive benefit package in our
Affordability > The Health Security Act would take great strides
toward rendering health care affordable for most of the population. The
employer mandate and the establishment of the lower cost-sharing option,
section 1132, would help lower the price of health care to many. The
requirement of community rating in setting premiums would eliminate
disproportionately high premiums charged to older persons, people with
disabilities and those with extensive medical care needs. A variety of
subsidies for poorer people would help bring coverage within their reach.
Nevertheless, for many poorer people, the cost of care would still
be so prohibitive as to bar them from seeking treatment for their medical
needs. Even under the lower cost-sharing schedule, patients will be
responsible for a co-payment of ten dollars per visit for most medical
services, as well as a five dollar co-payment for each prescription they
fill. Section 1135. While AFDC and SSI recipients will have this
co-payment reduced by 80 percent, section 1371(c)(2), all other poor
persons -- including individuals receiving state general assistance and
those who are eligible for but not receiving AFDC or SSI -- will be
obliged to make these comparatively expensive payments. For a family
living at or near the poverty line, such co-payments may represent a
substantial portion of their available funds, forcing them to choose
between obtaining medical treatment and the other basic necessities of
Moreover, the aggregate limits on cost sharing are excessive for
the poor. Under the Act, poor families will be expected to absorb $3000
of out-of-pocket costs -- the same as an affluent family -- and an
individual will face out-of-pocket charges of $1500. These "limits"
represent over 20 percent of poverty level income for an individual or
family of four, according to Administration figures, and over 30 percent
for a married couple with no children. They are an unreasonable burden
for poor people to bear.
The ACLU understands that the purpose of the co-payment
requirement is to ensure that people exercise some personal responsibility
in deciding when to seek health care services. However, the government
would be irresponsible in asking poor people to defer medical care when
they need it. Yet this is precisely the choice to which the government
would push many poor people, including many individuals who today are
eligible for care through Medicaid. Co-payments should either be
completely eliminated for t he poorest people or, at a minimum, the 80
percent reduction in cost-sharing for AFDC and SSI recipients should be
extended to all other low-income individuals and families, and annual
out-of-pocket limits on cost-sharing should be capped at a modest
percentage of income.
Enabling services > Many people -- especially those who are poor,
undereducated, disabled or not fluent in English -- are daunted by the
complexity of our health care system and the difficulties of obtaining
treatment. Even if adequate health care services are available in a
community at low cost, people are often deterred from seeking treatment by
the difficulties of finding a doctor, making an appointment and getting to
the office. For this reason, adequate enabling services are essential if
health care coverage is to be truly universal.
Enabling services are designed to assist people in utilizing the
health care system. Such services include transportation, scheduling
assistance, community and patient outreach, patient education and
translation services. The Health Security Act recognizes their
importance. For example, sections 3461-62 establish a grant program to
provide enabling services in medically underserved communities. See also
section 3424 (requiring community health groups to offer services to
overcome obstacles in the way of access to care). Section 1203
authorizes, but does not require, states to provide extra services -- such
as outreach, transportation and interpreting -- to overcome barriers to
Although enabling services are currently mandated under Medicaid,
the Act would guarantee their continued availability only to AFDC and SSI
recipients. Section 4221. Low-income adults, including many persons with
disabilities who have little or no disposable income, need enabling
services to access other health care benefits. The ACLU believes that
enabling services must continue to be made available to all indigents,
language minorities and the near poor, and not limited only to SSI or AFDC
recipient s. To achieve the goal of universal coverage, necessary
enabling services for all who need them must be added to the package of
benefits guaranteed by the Health Security Act.
B. HEALTH CARE BENEFITS
1. Comprehensive Benefit Package
The Act's "comprehensive benefit package," which defines those
treatments and services that universal care will provide, also raises
significant issues of equal protection. Although the government is not
required to include coverage for every conceivable medical treatment in
its health program, limitations or exclusions are impermissible if they
have the effect of depriving particular subgroups of their right to
comprehensive, adequate care. Close scrutiny is warranted if the
subgroups have historically been disadvantaged or politically powerless,
such as women and children, racial, ethnic and sexual minorities, the poor
and the disabled.
The comprehensive benefit package guaranteed by the Health
Security Act is a laudable effort that would make access to important
treatment and services more equitable for many groups and individuals that
are currently underserved. In particular, the pro visions of coverage for
clinical preventive services, and for outpatient prescription drugs,
represent important expansions over many existing policies. Likewise, the
elimination of any lifetime cap on coverage, and the prohibition against
limiting cover age based on pre-existing conditions, serve to increase the
protections afforded eligible individuals.
Nevertheless, the ACLU has a number of equal-protection concerns
about the scope of the comprehensive benefit package that Congress should
address as it considers legislation.
Mandatory provision of the comprehensive benefit package > All
health plans are required to provide all of the health care services
included in the comprehensive benefit package. Section 1406(a) requires
all health plans to "enter into such agreements with health care
providers or have such other arrangements as may be necessary to assure
the provision of all services covered by the comprehensive benefit package
to eligible individuals enrolled in the plan." Similarly, section
1402(b)(1) prohibits a health plan from "terminat[ing], restrict[ing], or
limit[ing] coverage for the comprehensive benefit package in any portion
of the plan's service area for any reason." The ACLU supports these
One matter, however, requires clarification. The reference to
"such other arrangements" in section 1406 raises a question about whether
health plans must provide all covered services through their "provider
networks," section 1402(f), or whether some services need only be
available as "out-of-network items and services." In the ACLU's view, all
health plans must be required to offer the complete comprehensive benefit
package through their provider networks. Such a requirement would ensure
that enrollees in lower cost-sharing plans would be able to receive all
covered services in accordance with the lower cost-sharing co-payment
schedule. This appears to be the intention of section 1402(d)(1), but the
statutory language is unclear. Also, as discussed earlier, the ACLU calls
for clear and enforceable standards to ensure meaningful access to all
covered services throughout a plan's service area.
Medical necessity or appropriateness > Section 1141(a) excludes
from the comprehensive benefit package all items and services that are
"not medically necessary or appropriate." The ACLU has no objection to
this limitation; in our view, medical appropriateness or necessity should
be the touchstone for coverage. However, this standard should apply in
both directions. Services that are excluded from the comprehensive
benefit package in the ordinary case should be covered when they are
necessary elements of a covered course of treatment under the Health
Security Act. For example, HIV/AIDS disease often causes dental problems
that require treatment; yet the comprehensive benefit package excludes
treatment of dental disease for persons over 18. Section 1126. Whether
or not this limitation is appropriate in the ordinary case, it should not
prevent a person living with HIV/AIDS from receiving dental care
necessitated by the illness. Therefore, Section 1141 should be amended to
permit expanded coverage for certain services where medically necessary.
Such a provision is also required to counterbalance section
1141(a)(2), which authorizes the National Health Board, by regulation, to
exclude coverage for items and services it determines are not medically
necessary. When a health care provider determines that an item or
service covered by the statute is medically necessary for a particular
patient, that determination must override the more generalized judgment of
Preventive services > Section 1114 presents an extensive list of
covered clinical preventive services for persons of varying ages. In
addition, section 1153 authorizes the National Health Board to define
additional clinical preventive services for particular high risk
populations. Finally, section 1112(b) provides that a listed clinical
preventive service may be provided at times or frequencies other than
those set forth in section 1114 and covered as a health professional
service, so long as it is medically appropriate.
As noted above, the ACLU supports the decision to include
preventive health care as part of the comprehensive benefit package. We
are concerned, however, that the schedule of clinical preventive services
listed in section 1114 may be deficient in several respects. For
example, it is our understanding that the provisions on health care for
minors permit fewer clinician visits than recommended by the American
Academy of Pediatrics. Similarly, questions have been raised about
whether section 1114 provide s for adequate coverage of women's Pap tests
and mammograms, as well as about that section's apparent failure to
include coverage of syphilis screening for women of childbearing age who
are at risk for fertility-related infectious diseases.
It is not sufficient, in our view, to suggest that such services
might be covered under either section 1153 (through National Health Board
rulemaking) or section 1112(b) (authorizing episodic, medically necessary
services). The American public has the right to be assured that its
health care system will provide adequate preventive coverage, and that
service exclusions are not impermissibly linked to gender or historical
vulnerability. Moreover, services under section 1112(b) are subject to
co-payments or co-insurance, which the Act clearly recognizes are not
appropriate for preventive services and, thus, may prove unaffordable for
many indigent individuals. At a minimum, the table of co-payments and
co-insurance in section 1135 should be modified to eliminate any
cost-sharing for preventive services provided under section 1112(b).
Finally, outside of the comprehensive benefit package, the
President's plan provides enhanced preventive care benefits for AFDC and
SSI recipients that are equivalent to current Medicaid benefits, section
4221(a)(1). But it fails to make comparable provision for other
low-income adults, including disabled persons having no disposable income.
No indigent should be denied preventive care that is deemed necessary by
the Medicaid program.
Women's health > The Health Security Act properly recognizes that
women have many unique health needs. As just discussed, the Act makes
separate provision for clinical preventive services for breast and
cervical cancer, as well as fertility-related infectious illnesses.
Section 1114. In addition, section 1116 provides coverage for family
planning services, prescription contraceptives and services for pregnant
women, including prenatal and postpartum care. Section 1135.
Reproductive services are the health services most commonly sought
by women. Comprehensive reproductive care encompasses a wide variety of
services, including pelvic exams, contraception, pregnancy testing,
fertility treatment, prenatal care, obstetrics , abortion, treatment of
gynecological disorders and sexually transmitted diseases, Pap tests for
uterine cancer screening and treatment for menopause.
The ACLU supports the inclusion of a complete range of these
services in whatever comprehensive health package is adopted by Congress.
Women need all of these services at various stages. The same woman will
choose contraception, abortion or prenatal care at different periods of
her life. She will not necessarily be able to anticipate or predict in
advance which service she will need at any given time, so all must be
available to her at all times. None of these services is dispensable if
women are to have their health needs adequately met.
It is imperative that the comprehensive health care package
include, as currently proposed, abortion as one of a number of
reproductive options for women. Women have a fundamental constitutional
right to choose to have an abortion. This right is based on both the
equal protection and privacy protections guaranteed by the First, Fourth,
Fifth, Ninth and Fourteenth Amendments. By providing coverage for
abortion services, the Health Security Act properly recognizes that
abortion is a complex decision that belongs to a woman alone. The ACLU
believes, however, that the Act must clarify that abortion services cannot
be restricted or delayed by a health plan's "gatekeeper" requirements. In
addition, we assume that the Act means to leave it to the physician , in
consultation with her patient, to determine whether a procedure is
medically necessary or appropriate under section 1141 (which limits
comprehensive benefit package services to those that are "medically
necessary or appropriate").
Under current federal Medicaid provisions, women with family
incomes up to 133 percent of the federal poverty line, and in some states
up to 185 percent of the poverty line, receive fully subsidized prenatal
care, labor and delivery services, and postpartum care. The Act
threatens all but those persons eligible for AFDC or SSI, who generally
live well below the poverty line, with loss of no-cost coverage for these
critical services. For poor and low-income women, even low premiums and
co-payments may pose insurmountable barriers to care. The Act should not
deprive low-income women of access to pregnancy-related services, and any
exemptions for low-income women from premiums and co-payments related to
such services should apply equally to abortions.
Services for individuals with disabilities > Individuals with
disabilities often require extensive health care services and incur
disproportionate health care costs. To satisfy equal protection concerns,
a health reform system must be sensitive to the needs of disabled people.
The Health Security Act's elimination of both lifetime caps on
benefits under health insurance policies and restrictions on coverage for
pre-existing conditions is essential for the equitable treatment of
disabled persons' health needs. The ACLU support s these provisions.
Nevertheless, the ACLU has at least two concerns regarding coverage for
the disabled under the comprehensive benefit package.
First, we question the limitation on outpatient rehabilitation
services under section 1123. Section 1123(b)(1) limits such services to
those that "restore functional capacity or minimize limitations on
physical and cognitive functions as a result of an illness or injury."
This language would appear to exclude rehabilitation services for the
treatment of disabilities existing at birth. This restriction should be
Second, the ACLU is concerned about the limitations on services
for mental illness and substance abuse under section 1115. Some forms of
mental illness are disabilities recognized and protected under the
Americans With Disabilities Act. Therefore, the strict annual limits on
services for mental illness in section 1115 would have a
disproportionately adverse effect on the disabled. In addition, health
plans are authorized to limit coverage under this section "based on
criteria that the plan may choose to employ." This limitation effectively
undermines any guarantee that mental health and substance abuse services
would be available. Like other essential health services, mental health
and substance abuse services should be an entitlement under the Act, and
the scope of covered services should be expanded for those persons whose
mental illnesses and substance abuse constitute disabilities.
2. Supplemental Benefit Programs
Not all health services will be provided through health plans
offering the comprehensive benefit package. The Health Security Act
includes a variety of other programs offering various forms of health care
services. A few of these raise equal protection concerns that deserve at
least brief mention here.
Home and community-based services for individuals with
disabilities > Sections 2101 et seq. establish federal funding for
programs to provide home and community-based services for persons with
disabilities. States become eligible for this funding by sub mitting an
approved plan for a program offering these services. However, the Act is
quite explicit that no individual entitlement to these services is
intended. Section 2101(b). The ACLU believes that, although a state need
not participate in this prog ram, once it has submitted an approved plan
eligible residents of that state have a right to services that are
necessary and appropriate. Virtually all of the other health benefits
conferred by the Act are explicitly declared to be entitlements. Serious
equal protection concerns are raised by the Act's differential treatment
of benefits to home and community-based services.
Medicaid > Under the Health Security Act, the Medicaid program
would be reduced to a shadow of its former self. For all persons
currently receiving Medicaid, other than those who are also recipients of
AFDC or SSI benefits, Medicaid would be reduced to a financing program for
long-term care services and Medicare cost-sharing. Section 4221. While
AFDC and SSI recipients would continue to receive Medicaid coverage for
all items and services not covered by the comprehensive benefit package --
such as dental care, eyeglasses, rehabilitative services, durable medical
equipment and comprehensive mental health and substance abuse treatment --
other current Medicaid recipients would be ineligible for expanded
coverage and face prohibitively high co-payments. The ACLU opposes this
differential treatment of indigents who are similarly situated as a group
because of their dire financial need. At a minimum, as already noted,
supplemental Medicaid services should remain available to all classes of
people currently eligible for Medicaid.
Another concern is raised by the transformation of the early and
periodic screening, diagnostic and treatment services program (EPSDT), the
existing Medicaid program of health services for children. The Health
Security Act retains the outlines of EPSDT through the creation of a
program of "services for poverty-level children with special needs."
Section 4222. This program retains essentially the same eligibility
standards as EPSDT, and it is structured to cover all EPSDT services
beyond the scope of t he comprehensive benefit package. All of the
foregoing is desirable, for EPSDT has been a critically important health
care service for those poor children who have had access to its benefits.
Many states, however, have consistently failed to live up to their legal
obligations under EPSDT, so that millions of eligible children have never
been able to avail themselves of the program's services. Unfortunately,
the Health Security Act caps federal funding for section 4222 services at
the level of Medicaid funding spent on covered EPSDT services in 1993
(adjusted for changes in the number of eligible children and for
inflation). As a result, funding for this program will remain inadequate
and necessary preventive health care will remain out of reach for many
indigent and vulnerable children.
C. FINANCING HEALTH CARE REFORM
Equal protection issues arise in connection with the proposed
system for financing health care reform. In matters of revenue raising,
courts have traditionally granted the political branches of government a
great deal of leeway, and they have generally upheld financing schemes if
they could find a reasonable basis for the distinctions they drew.
Nevertheless, any time a financing scheme treats two similarly situated
entities differently there is a potential equal protection concern.
A comprehensive analysis of the Health Security Act's financing
scheme, which is exceedingly complex, is beyond the scope of this paper.
Here we can only highlight a few provisions.
On the positive side, the Health Security Act promotes principles
of equal protection by eliminating many of the sharp disparities that
plague our existing medical insurance system. By eliminating experience
rating, and by allowing most families to purchase health care coverage
through a common regional alliance purchasing pool, the Act goes far
toward equalizing individuals' opportunity to obtain health care at a
In a number of ways, the Health Security Act also discourages
discrimination by taking away certain incentives to differentiate among
groups. For example, by paying health plans a blended per capita rate for
enrollees, whether they are enrolled at the normal premium or at a lower
rate as an AFDC or SSI recipient, sections 6201-02, the financing scheme
deters health plans from discriminating against recipients of cash
assistance. Likewise, by mandating risk adjustment for payments to health
plans, section 1541 removes (or at least reduces) a disincentive for
enrolling individuals who are likely to have disproportionately high
health care costs. Finally, by blending the employer premium obligation
for single parent and two parent families to yield a uniform rate,
section 6122(a)(3), the Act eliminates an incentive for employers to
prefer one category of employees to another.
Third, the Health Security Act takes account of differences in
ability to pay by reducing certain payment obligations for poorer
families. Sections 6104 and 6113 limit the rate and amount of a family's
obligations for premiums and repayment of the alliance credit based on
income, while section 1371 reduces cost-sharing obligations for some
low-income families. The Act also provides for sliding payment scales for
services offered by qualified community health plans and practice
networks, section 3424, and for home and community-based services for
people with disabilities, section 2105.
Finally, the ACLU supports the establishment of a tax credit to
reduce the cost of personal assistance services for working persons with
disabilities. Section 7901. This provision furthers the
nondiscrimination goals advanced by the Americans with Disabilities Act
by easing the path for disabled people to reenter the workforce.
However, the ACLU is troubled by some aspects of the Health
Security Act's financing provisions. Several of our concerns relate to
the differential treatment of particular categories of the poor. We are
also concerned about the disparities that will inevitably arise in
premium costs among alliances.
Our principal concern relates to the differential treatment
accorded low-income families receiving cash assistance through AFDC or SSI
by comparison to other poor families. Under the Act, AFDC/SSI recipients
pay no premiums, section 6104, and have their co-payment obligations
reduced by 80 percent, section 1371(c)(2). Other families living near or
below the poverty line must pay a premium equal to a percentage of their
income, and they are also obligated to pay the full co-payments required
under the l ower cost-sharing schedule. There is no legitimate basis for
this distinction, which for many poor families would result in a reduction
of health care from current levels. AFDC eligibility varies widely among
states, so a poor family eligible in New York may not qualify in
Mississippi. Also, since AFDC eligibility may be lost when a low-income
person returns to the workforce, these provisions would discourage AFDC
recipients from seeking employment. In the ACLU's view, premium and
co-payment reduction s, which we strongly support, should be based on
ability to pay, not on the source of a family's income.
There are other inequities in the Act's treatment of certain
categories of poor people. Under section 1902(25), for example, all poor
families are presumed to have two children for purposes of calculating the
applicable poverty level. Thus, a single mother with four children would
be treated as a family of three for determining her premium discount,
while a two-parent family with the same income and only one child would
receive a greater premium reduction because the Act treats them as a
family of four . Also, unlike those covered through regional alliances,
poor families enrolled in corporate alliance health plans would always be
obliged to pay at least five percent of the premium for their health plan.
We are also concerned about the inequalities in financing that
would arise between persons living in different alliance areas. Although
the Health Security Act contains protections against concentrating the
poor or others with high health care costs in particular alliances,
section 1202, it is inevitable, given the uneven distribution of the poor
throughout the country, that some alliances would bear a disproportionate
share of high-cost, low-income families. Because premiums and related
obligations under the Act are determined separately for each alliance,
employers and full premium paying families in these alliances would be
forced to pay higher amounts. The ACLU believes that efforts should be
made to share this burden more widely.
Finally, the proposed financing system might increase the
incentive for certain large employers to discriminate against workers with
high cost medical conditions, or workers who are perceived to be at risk
for illness and disease due to personal characteristics or lifestyles.
Most employers would pay the same rates, regardless of their employees'
health costs. Large employers, however, could self-insure by operating
corporate alliances and could lower their costs by getting rid of or
refusing to hire high risk employees. To prevent this, the ACLU believes
that the Act should bar employment discrimination based on medical
condition or conduct that increases medical risks.
D. TRANSITIONAL INSURANCE REFORM
The Health Security Act also contains a number of provisions for
transitional insurance reform. These provisions would govern health
insurance policies during the period before the new health care system is
in place. Not surprisingly, given the transitional nature of these
provisions, they tend to go part way toward achieving the benefits of the
new system. These provisions include strict limitations of an insurer's
ability to terminate coverage for an insured and a requirement that
insurers accept new employees into existing group insurance plans,
section 11003; a prohibition against adjustments of premium rates based on
claims experience, section 11004(b)(4)(C)(ii); limitations on exclusions
for pre-existing conditions and waiting periods, section 1 1005; and a
partial prohibition against discriminatory reductions of benefits for
particular medical conditions, section 11006.
While none of these provisions goes as far as the new health care
system proposed under the Health Security Act to eliminate inequalities
and discrimination in the provision of health care services, each
represents an improvement over our current health care system. The ACLU,
therefore, supports these transitional measures, as interim steps toward
E. REMEDIES FOR DISCRIMINATION
In addition to the inclusion of substantive provisions that
further equal protection, it is important than any health care reform
legislation contain protections against discrimination. Any health care
reform plan as complex as the Health Security Act would necessarily
create numerous opportunities for discrimination. The Health Security Act
does incorporate a number of provisions that prohibit discrimination, see,
e.g., sections 1203, 1328, 1402, 1605, 1607(a)(3), and 4004, but these
provisions take a scattershot approach to the subject, differing in terms
of the entities covered, the forms of discrimination outlawed, and the
legal standard for finding a violation.
The ACLU believes that a more comprehensive response to
discrimination is required. In this section, we first discuss the
requirements for such a response before offering a few specific comments
on the provision in the Health Security Act barring discrimination in
1. General Requirements
In the ACLU's view, a comprehensive anti-discrimination section
should be incorporated into the Health Security Act. The provisions of
this section should meet each of the following requirements:
Covered entities > The prohibition against discrimination should extend
to all entities that are assigned functions or responsibilities under the Health Security Act and should apply to all actions taken by those entities in fulfilling those functions and
responsibilities. Covered entities would include at least the following:
the National Health Board and other agents of the federal government
assigned responsibilities under the Act; states, regional and corporate
alliances, health plans, health care providers and employers. We
envision statutory language that would read something like: "No person, in
carrying out functions or responsibilities pursuant to this Act or in
connection with the provision of health care in accordance herewith, shall
discriminate ..., nor shall they discriminate against any person based
upon the manner in which he exercises his rights under this Act."
Prohibited discrimination > The Act should broadly prohibit various forms
of discrimination, whether or not it seems likely in a particular context
that a particular form of discrimination will occur. The ACLU believes
that the Act should prohibit discrimination based on any of the following
characteristics or perceived characteristics: race, national origin,
gender, age, religion, disability, socio-economic status, citizenship or
immigration status, sexual orientation, language, political beliefs,
family status, health status or anticipated need for health services.
Standard for discrimination > The prohibition on discrimination should
outlaw not only intentional discrimination, but also conduct that has a
discriminatory effect. Section 1402(c)(1) of the Health Security Act is
an example of such a provision. Under such a discriminatory effects
provision, any defense based on a claim of "business necessity" must be
narrowly circumscribed. The burden must be placed on the defendant to
establish both that the discriminatory practice was justified by business
necessity and that no less discriminatory alternative is available.
Under no circumstances, however, should business necessity be a defense to
a claim of intentional discrimination.
Affirmative action > The Health Security Act contains a number of
provisions designed to increase minority representation among health care
workers, and to improve health care services in underserved minority
communities. Any anti-discrimination provision should clearly provide
that such programs and other appropriate affirmative efforts to increase
services to underserved populations or remedy underrepresentation do not
constitute unlawful discrimination.
Enforcement provisions > The Act should establish procedures for enforcing
its prohibitions against discrimination through private civil actions,
administrative enforcement proceedings and civil enforcement measures. In
egregious cases, criminal penalties may also be appropriate. Persons
aggrieved by violations of the prohibitions against discrimination should
be able to bring a private civil action for damages and/or equitable
relief. Prevailing plaintiffs should be awarded attorney's fees, expert
witness fees and costs. Section 5238 is the provision of the Health
Security Act that comes closest to providing the range of enforcement
procedures we recommend.
Applicability of existing anti-discrimination laws > The Health Security
Act should expressly provide that the inclusion of particular
anti-discrimination provisions in the Act is not intended to, and does
not, preempt the application of existing state or federal
anti-discrimination laws to the conduct of persons dispensing health
services or otherwise carrying out functions under the Act. Moreover, the
Act should expressly provide, in a manner similar to section 5239, that
all regional alliances, health plans and health care providers receiving
payment for services pursuant to the Act shall be treated as recipients of
federal financial assistance for purposes of applying the relevant
provisions of existing federal civil rights statutes.
2. Alliance Boundaries
Section 1202(b)(4) of the Health Security Act prohibits states
from discriminating in establishing boundaries for alliance areas. In
addition to the modifications suggested above, because we believe that it
will be exceedingly difficult to modify alliance boundaries once they are
established and operational, the ACLU recommends that regional alliance
boundaries be subjected to preclearance review in a manner similar to that
required for electoral changes in covered districts under the Voting
Rights Act. Preclearance review would provide assurances that alliances
are structured in a nondiscriminatory way before they begin operation, and
would minimize the necessity for dismantling and reorganizing these
boundaries after the reformed health care system h as taken effect.
To similar effect, section 1202 contains language prohibiting
states from "otherwise tak[ing] into account" race, national origin,
socio-economic status and the like in establishing alliance boundaries.
In our view, states should take these characteristics into account so as
to draw alliance boundaries that further our national commitment to
integration. The Act should expressly instruct states to draw alliance
boundaries, subject to preclearance review, that avoid concentrating
minorities, the poor or the disadvantaged in particular alliances.
II. PERSONAL PRIVACY
Health care reform raises serious issues concerning personal privacy. The
Constitution guarantees a right to privacy, including both privacy of
personal information and autonomy in personal decision-making. Decisions
about medical treatment are among the most sensitive decisions we make,
and our medical records contain some of the most intimate and confidential
information about our lives.
We have already discussed the issue of including abortion and
other reproductive health services in the comprehensive benefit package.
The right to reproductive choice, which, in the ACLU's view, mandates the
inclusion of these services, is grounded in the constitutional right to
privacy, as well as the right to equal protection. In this section, we
focus on issues of privacy in personal information.
The Health Security Act proposes to develop a national electronic
data network of medical information, which potentially poses a serious
threat to the confidentiality of medical records. In addition, the
proposed health care financing system, by setting deductibles and
out-of-pocket limits on families rather than individuals, threatens to
reveal a patient's medical treatment to her parents or spouse. Finally,
the Health Security Card that the plan proposes to give to every enrollee
poses a grave danger of becoming a national identity card and also creates
dangerous opportunities for discrimination. The ACLU opposes these
threats to information privacy, and believes that any legislation must
incorporate comprehensive privacy protections.
A. PRIVACY OF MEDICAL INFORMATION
Crucial to one's sense of self and autonomy is the right to
maintain some decision-making power over what information is divulged, to
whom and for what purpose. The ACLU believes that the protection of
informational privacy, particularly of intimate and sensitive medical
records, is central to any health care reform proposal.
1. Medical Record Confidentiality
The Health Security Act would require the creation of a national,
linked electronic data network containing vast amounts of biographical and
health information on virtually every U.S. resident. Such a network would
have a tremendous impact on an individual's ability to control the use,
disclosure and security of personal and sensitive information.
be based on the following central principles:
1) Strict limits on access and disclosure must apply to all
personally-identifiable health data, regardless of the form in which the
information is maintained.
2) All personally-identifiable health records must be under an
individual's control. No personal information may be disclosed without an
individual's uncoerced, informed consent.
3) Health record information systems must be required to build in security
measures to protect personal information against both unauthorized access
and misuse by authorized users.
4) Employers must be denied access to personally-identifiable health
information on their employees and prospective employees.
5) Patients must be given notice of all uses of their health information.
6) Individuals must have a right of access to their own medical and
financial records, including rights to copy and correct any and all
information contained in those records.
7) Both a private right of action and a governmental enforcement mechanism
must be established to prevent and/or remedy wrongful disclosures or other
misuse of information.
8) Establishment of a federal oversight system to ensure compliance with
privacy laws and regulations.
The Health Security Act acknowledges the importance of maintaining
the confidentiality of an individual's medical records and protecting such
information against unauthorized disclosure and use. Findings, Section 2.
Moreover, in general, the Act incorporates many of the foregoing
principles of privacy protection, section 5120(c), and in that sense it
provides the framework for an enforceable and effective protection scheme.
According to the Act, disclosures of personal information must be strictly
limited. Individuals would have a right of access to their own health
information, and disclosure to third parties would require patient
consent. Law enforcement agencies would have access to such information
only for limited health-related functions, and use by employers would be
absolutely barred. Further, individuals would be given notice of how
information would be collected, used and shared. The Act also
contemplates federal legislation to protect the privacy of individually
identifiable health information, which would include a code of fair
information practices, along with enforcement provisions. Section 5122.
However, the Health Security Act lacks any specific proposal for
accomplishing its privacy mission. Instead, the Act defers to a later
date the National Health Board's responsibility for developing privacy
standards. From the date of enactment, the Act gives the Board two years
to promulgate standards for the privacy and security of individually
identifiable health information, section 5120 (a), and three years to
submit a legislative proposal to provide a comprehensive scheme of federal
privacy protection, section 5122.
The Act's statement of privacy principles, without more, is
insufficiently protective of personal privacy. Although the principles
included in the Act are quite strong, the ACLU believes that the Act must
from the outset include explicit, enforceable privacy protections.
Studies show that it is difficult, if not impossible, to build privacy and
security protections into a complex information system once it is already
in place. Rather, privacy protections must be built in at the "front
end." The creation of a satisfactory health information system, one that
respects and protects patient privacy, can occur only if the Clinton
Administration sets forth as part of the enabling statute the privacy
requirements that must guide the system's design, along with an effective
enforcement mechanism. For example, the Act requires the creation of an
electronic data network that will link regional centers to collect,
compile and transmit information. Such an amassing of sensitive, personal
information would seriously jeopardize information privacy if legal
requirements are not in place from the outset.
The ACLU firmly believes that any health reform plan must contain
specific and enforceable limitations against the use of medical
information, and sanctions for misuse. We will strongly support efforts
to convert the privacy principles in the Health Security Act into such
specific, enforceable legislation.
2. National Identifier/Social Security Number
The creation of a national electronic data network -- facilitated
by a card and a unique identifier -- raises very serious privacy concerns.
The ACLU believes that any personal information collected and amassed for
inclusion in the system's electronic data network should not be used for
any non-health related purpose. We acknowledge that the Act limits the
permissible uses of the health security card, section 5105, and
establishes criminal penalties for its misuse, section 5438. It is
important to recognize, however, that such a comprehensive, linked
database would pose a great temptation to others in the private and public
sector who would want access to the information for a variety of purposes,
ranging from marketing to law enforcement.
Once the network is in place, it would be very difficult for
Congress to limit its use. Indeed, the history on this issue is replete
with examples of information systems being created for a limited purpose,
only to be expanded at a later date after pressure. The Social Security
system, created for a limited purpose 60 years ago, now functions as a de
facto national identifier, and the FBI's criminal records systems,
initially developed for law enforcement, is now used primarily by the
non-law enforcement community. To prevent the expanded use of a medical
electronic data network, Congress must be committed to maintaining and
enforcing the Act's health care mission and the privacy principles that it
We urge that the Act prohibit the National Health Board from using
the Social Security number as the unique identifier number for accessing
health information. The Social Security number is a notoriously
unreliable number, but one that is used for a wide array of public and
private purposes. The Social Security Administration has testified that
the Social Security number is not a reliable identifier due to the high
percentage of duplicate, fraudulent and inaccurate numbers. Currently,
there is no way to verify the accuracy of existing numbers or that the
number holder is who she claims to be. For both of these reasons, the use
of the Social Security number would jeopardize the privacy and security of
personal health information maintained under the Act.
Further, because the Social Security number has become the most
widely used identifier -- even on most driver's licenses -- health records
would become vulnerable to abuse. Even without a card, a national health
plan that relies on the Social Security n umber as an identifier has the
potential to threaten the privacy of individual medical information. The
Act should require the Board to develop a new unique identifier, limited
to the health care context. In this way we can best protect personal
health records from unauthorized access.
3. Financing and Intra-Family Privacy
The financing provisions of the Health Security Act raise concerns
about the ability of an individual to protect against disclosure of
confidential medical information to members of her own family. Under the
Act, health plans provide coverage on a family rather than an individual
basis; premiums and cost-sharing obligations are calculated in the same
way. This approach may compromise individual privacy.
When an individual obtains any health service that is subject to
cost-sharing under the Act, it would be necessary for the health care
provider or health plan to determine whether any applicable family
deductible or out-of-pocket limit has been met. In order to make this
determination, a combined record of family medical expenditures must be
maintained. As a result, another family member might be able to obtain
information about care received by a child or spouse.
Individuals should have the right to receive medical treatment
without their family's knowledge. Therefore, protections must be built
into the financing system to prevent this kind of disclosure.
B. NATIONAL HEALTH CARD
The Health Security Act requires the creation of a health security
card and a unique identifier system for individuals, sections 5104-05, and
gives the National Health Board substantial discretion in determining the
type of card and identifier. The creation of any type of national card
raises serious civil liberties problems. The type of national health card
and identifier scheme outlined in the Act is especially problematic for
several reasons. Based on our experience, the national health care card
envisioned by the Act would result in widespread discrimination against
foreign-appearing citizens and residents, would become a de facto national
identity card and would greatly increase the threat to personal privacy.
Discrimination > The Act's health care card would lead to discrimination
in at least two significant ways. At the outset, foreign-appearing U.S. citizens and residents are likely to face discrimination when applying for a card (as well as when attempting
to replace a card). Because the Act would exclude a large segment of the
immigrant community, some type of screening process would presumably be
necessary to determine who is eligible for a card. The Act does not
specify who would be responsible for ad ministering this process. Whether
it is a federal, state or private entity, immigrants and
"foreign-appearing" citizens, especially Latinos, Asians and persons with
accents, would be subjected to greater scrutiny and disparate treatment by
skeptical administrators charged with deciding who should receive a card.
In addition, once a national card is in place, foreign-appearing citizens and residents would face discrimination outside of the health care context. Despite proposed penalties against the use of the card for non-health related reasons, it is inevitable
that banks, employers, landlords and law enforcement, among others, would
begin requiring individuals to produce the card to prove their identity
and status. Moreover, immigrants ineligible for health care under the Act
-- many of whom possess work authorization and are permanently residing
in the United States under color of law -- would be unable to produce a
card and be denied equal treatment. The prospect of discrimination is not
speculative. A recent report by the General Accounting Office (GAO) has
documented the widespread discrimination that has resulted from Congress'
1986 decision to make employers quasi-immigration inspectors by requiring
them to verify a job applicant's immigration status before hiring. There
is every reason to believe that the health card proposed under the
Health Security Act would result in at least as much discrimination.
National identity card > Independent of any discrimination
problems, the Clinton card would evolve into a de facto national identity
card that all citizens and residents -- regardless of appearance or
immigration status -- would have to carry with them a t all times in order
to function in society. At present, a variety of regional documents can
serve as identification. Once a single, uniform national card is created,
it would replace all other forms of identification and function like
"official papers" or like an "internal passport" functions in other
Privacy > The card would also exacerbate the Act's threat to individual
privacy, particularly if the National Health Board adopts the Social Security number as the health identifier and places the number on each card. As noted above, the Social Security
system is neither reliable nor secure. This is due in large part to the
expanding uses of the Social Security system, giving an increasing number
of people access to one's number. Placing an individual's Social Security
number on health cards would substantially compound the problem by
further exposing the number, thereby threatening both sensitive health
records and all of the personal information currently linked to the Social
Security system. Indeed, because a national health care card would
eventually replace all other forms of identification and, thus, be
required for virtually every function in society, using the Social
Security number in the health care context would dramatically increase the
The ACLU believes that the most effective way to avoid all three
of these civil liberties problems is to eliminate the card from the plan.
We recognize that a health system that covers only some U.S. residents may
need a mechanism for identifying eligible participants. We also
recognize that health care providers would benefit from ready access to an
individual's relevant medical history. Yet both of these objectives can
be accomplished without a card, and further study must be given to
alternatives to the card.
If, however, some form of national card is approved, it must
contain the following features. First, to eliminate discrimination
against foreign-appearing individuals, a card must be provided to all
persons, regardless of immigration status or health car e eligibility, and
that card must not contain any visible information regarding an
individual's immigration status or eligibility for health care. Issuing a
card to all residents of the United States is a viable alternative, since
every resident, regardless of immigration status, is eligible under the
Health Security Act for at least emergency care. The card could contain
information indicating limitations on the individual's entitlement to
coverage, but that information must be reflected in encoded information
accessible only to authorized health care individuals.
In addition, even if the card is issued to everyone to reduce the
potential for discrimination, it would still have the potential to become
a national identity card. To reduce that possibility, the card should
contain no visible information useful for serving as an identity or
"status" document. It should resemble a bank cash card, which contains
little information on its face and can be accessed only by an individual
entering his or her code number into a computer.
Finally, to reduce threats to privacy, the card under no
circumstances should contain an individual's Social Security number --
even if the Social Security number were ultimately adopted as the
individual health identifier.
III. DUE PROCESS
The Constitution mandates that no person shall be deprived of "life,
liberty, or property, without due process of law." A
government-supervised system of comprehensive health care affects each of
the three interests protected by the due process clause. At the most
basic level, inadequate health care can deprive an individual of life. In
addition, a denial of health care can also impair an individual's ability
to engage in normal life activities, a liberty interest that is also
protected by due process. Finally, health care affects individual
property interests -- in premiums and cost sharing, and in the health care
items and services to which a person is statutorily entitled. For these
reasons, any health care reform legislation must comply with due process.
In this section, we discuss those aspects of due process that
relate principally to procedure: the process that is due when an
individual interacts with the health care system and the adequacy of that
process to protect the individual's life, liberty and property interests.
At its core, procedural due process requires that an individual receive
timely and meaningful information about rights and responsibilities, and
that fair procedures be in place to challenge a deprivation of rights.
A. CONSUMER INFORMATION
Due process requires that individuals receive timely and
meaningful notice of their rights under a reformed health care system.
This includes information about health care plans necessary to make
deliberate and well-reasoned choices; about a chosen plan 's scope of
coverage; about financial obligations; about how to challenge abuse or
adverse decisions, whether by a plan, alliance, employer, provider or some
other actor in the health care system, and information about how medical
records may be used and by whom.
In order to satisfy due process, information must be thorough,
understandable, accessible and timely:
Thorough > Information provided by the health care system must be
sufficiently comprehensive for consumers to make meaningful choices among
their options. For example, in choosing among health plans, consumers
must be thoroughly informed about costs, benefits, providers, quality of
care and limitations on services.
Understandable > Information must be presented in a straightforward
fashion and in lay language, so that it can be interpreted by a person
without a background in health care, insurance or finance. Information
must also be available in alternative format s and languages other than
English to meet the needs of individuals with disabilities or of limited
English proficiency. Trained support personnel must be available to
answer questions and to assist individuals to understand their options.
Accessible > Information is only useful if it gets into the hands of those
who need it. General informational materials should be distributed
directly to all consumers. More specialized or detailed information must
also be developed and distributed to targeted populations. In addition,
steps must be taken to publicize how consumers can obtain additional
information and assistance on an as-needed basis.
Timely > Information must be provided in a timely fashion, so that
consumers can consider their options in an informed and deliberate way
before decisions must be reached.
The Health Security Act gets only mixed marks for consumer
information. We believe that the Act establishes an acceptable framework
for ensuring protection of due process rights for consumers. We are
concerned, however, that it leaves open, without sufficient guidance,
many troubling gaps for later development or rule-making. Although the
Act recognizes the importance of providing notice to consumers, it is too
often vague about the information that must be disseminated and the
procedures that must be available.
Selection of health plan > Section 1325 of the Act requires that
regional alliances, prior to each open enrollment period, make information
available to eligible enrollees so that they can make valid comparisons
among health plans. The materials must be "in an easily understood and
useful form" and include information on cost, quality of care performance,
participating providers, any restrictions on access to providers and
services. In similar fashion, health plans must also provide "timely and
complete information" on similar subjects to applicants and participants.
Section 1404(b). Employers must likewise provide new employees with
information on the plans that are available. Section 1603(c). Finally,
alliances are required to conduct educational programs "to assist
consumers in using quality and other information in choosing health
plans." Section 5012(4).
Despite these provisions, the Act leaves open many important
questions about the kind and quality of information that will be provided
to consumers to allow them to reach threshold decisions about health care
plans. The Act defers many of the most important questions about
consumer information to rulemaking by the National Health Board but fails
to provide guidance to ensure that the ultimate rules comport with due
process. At a minimum, every alliance should be required to distribute
information -- in alternative formats where appropriate -- to all
potentially eligible enrollees, and regional alliance ombudsmen, section
1326, or similar persons or groups should be assigned responsibility to
assist consumers in comprehending these materials. Health plans and
employers must also play a meaningful role in distributing information.
Health plan information for enrollees > Once a person selects a
particular health plan, she should be entitled to receive comprehensive
information about her health care coverage, comparable to the materials
provided by many employer-financed health insurance programs today. The
only requirement imposed by the Health Security Act -- that health plans
disclose their "utilization management protocols" to enrollees -- is
plainly insufficient from a civil liberties perspective. Section 1412.
In addition, enrollees must be provided full information about their
rights, benefits and responsibilities.
Applications for premium discounts and reduced cost-sharing >
Under the Health Security Act, low-income families may apply for premium
discounts and reductions in cost-sharing. Sections 1371-73. Alliances
are required to distribute applications "directly to consumers and
through employers, banks, and designated public agencies," and to assist
individuals in filing. Section 1374(a) and (h). In our view, the Act
should also explicitly require that alliances inform all potentially
eligible families of these programs in an understandable, timely and
Rights of veterans, Native Americans and members of military
families > Under the Health Security Act, veterans and Native Americans
may elect to enroll in health programs sponsored by the Veterans
Administration or the Indian Health Service, respectively, or they may
enroll in a regional alliance health plan. Sections 8101 and 8302.
Similarly, military families may have the option of enrolling in a
Uniformed Services Health Plan. Section 8001. Again, due process
mandates that affected individuals be provided timely and adequate
information about available health care options before reaching critical
decisions that will affect their lives and well-being.
B. ACCESS TO JUSTICE
Due process further requires that adequate procedural protections
be provided for individuals whose rights under the Act are denied. This
requirement has two components: First, the Act must provide substantive
remedies for individuals whose rights are denied by creating causes of
action and rights to relief; second, the Act must establish procedures for
enforcing those rights that are designed to yield fair, accurate and
expeditious resolutions, taking into account both the importance of the
interests involved and the risk of an erroneous deprivation of those
1. Substantive Remedies for Enforcing Rights
The Health Security Act creates private rights of action but
confines them to limited violations by a narrow range of actors. The ACLU
believes that the Act must expand substantive remedies to provide relief
for all violations of its provisions.
Claims for payment or provision of benefits > The Act allows
consumers to challenge a health plan's decision to deny payment or
withhold services that are included in the comprehensive benefit package.
As part of the process that is due, an individual i s entitled to have an
adverse decision reviewed at the plan, alliance, federal administrative
and judicial levels. Sections 5201-06. The Act also permits a claimant
to go directly from plan-level review to court. While the Act expressly
provides that a claimant may obtain an order of payment or services
through the administrative process, a comparable remedy may not be
available if judicial review is sought. Instead, a claimant who opts to
go to court will have her rights and remedies determined by state law.
Section 5206. The Act must be amended to guarantee the availability of an
enforcement order through either the administrative or judicial route.
The ACLU firmly believes that an adequate enforcement mechanism must be
available, wherever a consumer resides, and that the federal right to
health care cannot be defeated by limitations under state law.
Outside the comprehensive benefit package, the Act in two specific
cases declares new health benefits for eligible individuals but leaves
ambiguous the scope of enforcement mechanisms for challenging deprivations
of those benefits. Section 1115 incorporates certain mental health and
substance abuse services in the comprehensive benefit package. However,
the Act limits eligibility for some of these benefits to the "discretion
of [the] plan ... based on criteria that the plan may choose to employ."
Sect ion 1115(d)(2)(A) & (e)(2)(B); see also section 1115(c)(2)(B). In
the ACLU's view, a plan's selection of criteria and its application of
those criteria in specific cases must be subject to review under the
claims procedure established by sections 5201-06 . The Act should make
explicit that claims arising under section 1115 may be reviewed pursuant
to the general enforcement procedure of sections 5201-06.
Similarly, sections 2101-09 authorize states to establish programs
for home and community-based services. However, section 2102(b) dilutes
this important health care right by stating that nothing in these sections
"shall be construed to create an entitlement for individuals." The
ensuing sections define the states' responsibilities in terms of
requirements for an acceptable state plan, thus arguably rendering these
provisions subject to the Supreme Court ruling in Suter v. Artist M., 112
S.Ct. 1360 (1992), which has been read to limit the availability of 42
U.S.C. 1983 to enforce rights under state plans. Home and
community-based services are essential benefits for those who need them,
and the Act should ensure that once a state has an approved plan to
provide such services, aggrieved individuals have the right to enforce the
state's responsibilities owed them under these sections.
Enforcement of rights against states and alliances > The Health
Security Act establishes a federal private right of action against a state
or alliance to enforce responsibilities imposed on those entities by the
Act. Sections 5235 and 5237. The Act creates an analogous right against
the federal government when it acts in the role of a state by operating an
alliance system. Section 5236. The ACLU supports the creation of these
remedies. The Act should, however, be explicit that it effects a waiver
of Eleventh Amendment and state and federal sovereign immunity defenses
that might otherwise be available to defeat claims and damage awards. The
Act should also make clear that a state is a "person" for purposes of
enforcement under 42 U.S.C. 1983.
Enforcement of rights against health plans > In addition to the
claims procedure described above, the Act establishes a cause of action to
redress alleged discrimination by health plans under section 1402(c).
Section 5238(a). However, the Act does not create a general cause of
action against health plans to redress other denials of rights. The
limited cause of action to challenge a plan's denial of payment or
services is not alone sufficient. The Act should be amended to create a
private right of act ion against health plans, comparable to sections
5235-37, and a correlative cause of action. Damages and equitable relief
should be available.
Enforcement of rights against the federal government > The Health
Security Act creates no private right of action against the federal
government and its various departments, agencies and boards, except when
the federal government assumes the role of a state by operating an
alliance system. Section 5236. It is, of course, true that enforcement
may be secured through various federal statutory vehicles, including the
Administrative Procedure Act. Nevertheless, given the express rights of
action against states and alliances and the importance of health care to
all consumers, the Health Security Act should expressly establish both a
private right of action against the United States, or any department,
board or agency thereof, and a correlative general cause of action for
violation of any responsibility or duty imposed by the Act, including a
right to damages and equitable relief.
Declaratory judgments > Federal and state rules of procedure allow
parties to an actual controversy to secure a judicial declaration of
rights and legal relations. The availability of declaratory relief
recognizes the importance in certain circumstances of clarifying rights
and duties as expeditiously as possible. In the health care setting, the
stakes are too high to require consumers to postpone litigation until
after a formal denial of benefits has occurred. Rather, the Act should
make explicit that where an actual controversy exists between an
aggrieved individual or class of similarly situated individuals, on the
one hand, and a health plan, alliance, state or federal government, or
their agents, on the other, an action for declaratory relief may be
2. Fair Administrative Procedures
Once a remedy exists, due process requires that fair and adequate
procedures be in place that are designed to yield equitable and accurate
results in a timely fashion. The Health Security Act creates numerous
administrative remedies for consumers to challenge denials of rights or
benefits. The Act is less clear, however, in articulating the procedures
that govern the administrative remedies provided. The ACLU believes that
certain modifications are needed to meet constitutional norms.
Health plan claims procedure > The most elaborately detailed
procedures set forth in the Health Security Act govern challenges to a
plan's denial or delay in providing payment or benefits. Sections
5201-15. The Act provides for up to four layers of review of benefit
denials, with optional recourse to alternative dispute resolution programs
or directly to court. Section 5203.
The procedures governing these claims include, inter alia, notice
requirements, opportunities for review by impartial decisionmakers, a
right to representation at critical stages of the proceedings and
expedited procedures for urgent requests. Although these procedures show
a sensitivity to due process concerns, the ACLU nevertheless believes that
several modifications are necessary.
First, the notice provisions of section 5201(b)(1) should be
amended to require effective notice for the actual claimant. While the
present provision mandates language understandable to a "typical
individual," including one whose primary language is not English, there is
no explicit requirement that the language be appropriate for the actual
claimant. In the health care setting, individuals should never be
deprived of their rights without actual, meaningful notice.
Second, the prescribed procedures contemplate a prolonged process
of review, perhaps taking more than a year to complete. While such a
delay may be acceptable in certain limited cases, particularly where
services have already been provided, it is unacceptable where the
individual is seeking preauthorization for treatment. Shorter deadlines
for such claims must be established and strictly enforced. In addition,
section 5201(c) should clarify that either an individual or a provider can
provide the attestation required for an urgent request. Finally, given
the potential delays in the administrative process, the Act should provide
that any applicable statute of limitations is tolled during the pendency
of administrative review.
Lastly, the complexity of the administrative scheme itself may
threaten due process by creating traps for the unwary. Claimants must
first exhaust plan remedies before filing a complaint with an alliance
complaint review office. They must file such a complaint before they can
seek court review, and an election to go to court or to an administrative
hearing cuts off other potential remedies. Under these circumstances, it
is critical that all potential claimants receive timely, meaningful notice
that effectively describes the administrative process and the
consequences of any decision they may make.
Given the complexity of the system, the Act should also protect
against unintentional errors by including an explicit rule that
insignificant procedural mistakes can be disregarded. For example, a
claim filed directly with a court after exhaustion of plan remedies
should not be dismissed but, instead, transferred to a complaint review
office as if properly filed there. (The analogy here is to Rule 4 of the
Federal Rules of Appellate Procedure, treating notices of appeal
mistakenly filed with the court of appeals as timely filed in district
court.) Under no circumstances should procedural rules allow individuals
to lose substantive rights through inadvertence.
Miscellaneous remedial provisions > Numerous provisions of the Act
call for the establishment of fair hearing procedures or mandate the
promulgation of regulations to govern review of particular decisions.
See, e.g., sections 1344, 2002, 2103, 2326, 234 2, and 4202. We believe
that the Act should codify specific procedures or at least define minimum
procedural protections that will be applicable in each of these cases.
3. Judicial Review
The right of access to the courts is central to our constitutional
order. Only through judicial review of executive and legislative action
can the purposes of our separation of powers be effectuated, and only in
rare instances may government actions be absolutely insulated from
Despite these principles, in two instances the Health Security Act
attempts, improperly in our view, to restrict judicial review. First,
section 5241 purports to limit jurisdiction over facial constitutional
challenges to the Act by establishing a "statute of limitations" to take
effect one year after the Act becomes law, and also by prohibiting
preliminary injunctive relief. Neither provision is constitutional. The
so-called statute of limitations would absolutely bar constitutional
challenges to the Act by many persons who may not suffer injury from
unconstitutional provisions of the Act until after the time limit on suits
has expired. (The utter absurdity of this provision is demonstrated by
the fact that any person born more than a year after enactment would
never be able to challenge the Act's constitutionality.) Similarly, the
anti-injunction provision would prohibit courts from exercising their
equity jurisdiction to prevent irreparable and unconstitutional injury.
Congress may not prohibit courts from providing effective relief for
Second, in somewhat different fashion, section 5232 of the Act
attempts to insulate National Health Board determinations regarding
premium caps from judicial review. These board determinations may affect
the level of payment received by every alliance, health plan and health
care provider in the country, as well as the premiums paid by every family
and employer. While the courts have upheld the constitutionality of
statutory provisions that restrict the judicial review of certain matters
committed to agency discretion, these determinations do not fall in that
category. The Act establishes determinate standards for calculating
premium targets and for reducing payments to plans and providers. These
determinations must be subject to judicial review when they adversely
affect particular persons.
4. Attorneys' Fees
Access to justice is often illusory unless a consumer can find
competent counsel to undertake representation. This is especially true
where the success of a lawsuit will turn on complex issues of statutory
construction and factual disputes about medical necessity. For this
reason, it is essential that any health reform plan provide for the
possibility of attorneys' fees on behalf of consumers who challenge
The President's bill recognizes the importance of attorneys' fees
to an enforcement regime and provides for payment of attorneys' fees
(including expert witness fees) to the prevailing party in an
administrative or judicial proceeding. The Act's provisions take two
basic forms: Some require a mandatory award of fees but only to a
prevailing plaintiff or complainant, see, e.g., section 5204; others make
the award optional but extend it to any prevailing party, see, e.g.,
section 5237. The ACLU believes that all of the attorneys' fee provisions
should be mandatory but limited to a prevailing plaintiff or complainant,
most often a health care consumer. A guaranteed award of fees to
prevailing plaintiffs promotes access to justice and furthers the right t
o counsel. By contrast, the threat of fee awards to defendants -- usually
health care plans and alliances -- will discourage consumers from
exercising their rights to review. Sanctions for frivolous litigation,
such as those found in section 5204(d)(3)( B) and Rule 11 of the Federal
Rules of Civil Procedure, are sufficient to discourage litigation abuse.
5. Medical Malpractice Reform
The Health Security Act amends both federal and state tort
liability for medical malpractice in a number of respects. While the ACLU
does not believe that all "tort reform" limitations on liability
necessarily implicate constitutional rights, several of the provisions of
the Act raise civil liberties concerns and should be modified or rejected
to protect due process.
Overbroad definition of medical malpractice claim > The so-called
tort reform provisions of the Act apply to all "medical malpractice
claims," defined to include all "claim[s] brought against a health care
provider or health care professional in which a claimant alleges that
injury was caused by the provision of (or the failure to provide) health
care services," excluding claims for intentional torts or products
liability. Section 5301(7). The ACLU fears that this definition is
overbroad. For example, this language could apply to a discriminatory
effects claim brought against a health care provider for failure to treat.
It is not limited to the professional negligence claims at which it was
aimed. This statutory language should be narrowed.
Authorization for more restrictive state laws > While the Health
Security Act itself imposes generally modest restrictions on civil tort
liability for medical malpractice, section 5301(a)(2) permits states to
impose more substantial restrictions that would more clearly contravene
constitutional rights. This approach of establishing a federal ceiling
for liability, but not a floor, should be rejected. Any federal
legislation in this area should establish uniform federal standards for
Mandatory alternative dispute resolution > Section 5302 of the Act
requires that a person asserting a medical malpractice claim submit the
claim for mandatory alternative dispute resolution (ADR) before she may
file a malpractice suit. The proposed ADR system is required to be
affordable, timely, fair and non-binding. As such, it satisfies most of
the ACLU's due process concerns with such procedures. Nevertheless, there
is one protection that must be added. The Act must mandate that
submission of a malpractice claim for ADR tolls any applicable statute of
limitations to prevent the claimant from losing her right to a judicial
Certificate of merit requirement > For medical malpractice
actions, section 5303 requires the plaintiff to submit an affidavit
attesting that a "qualified specialist" has determined that there is a
"reasonable and meritorious" basis for the lawsuit. In concept, the ACLU
does not oppose such a certification requirement. In light of the
mandatory ADR process, a plaintiff is likely to have identified a
qualified expert to support her claim before going to court. Moreover,
the proposed certification does not go beyond the allegations the
plaintiff will need to prove to establish liability, and the deadline for
submitting the affidavit can be extended to avoid statute of limitations
problems or difficulty in obtaining medical records.Nevertheless, the ACLU
must oppose this provision as too restrictive because of the definition of
a "qualified specialist." Section 5303(c) requires that a "qualified
specialist" must have practiced or taught in the "same area of health care
or medicine that is at issue in th e action" within the past six years.
This is a far more restrictive definition than that required for an expert
witness under Rule 702 of the Federal Rules of Evidence. Therefore, this
provision imposes a burden on the plaintiff beyond that required to
establish liability and thus denies access to justice.
C. GOVERNMENT ENFORCEMENT PROGRAMS
Due process also applies to the government's efforts, both federal
and state, to enforce responsibilities imposed by the Health Security Act.
The Act establishes an elaborate enforcement regime, including criminal
sanctions, civil monetary penalties and disqualifications from
participation in various parts of the health care system.
1. Civil Enforcement Measures
The Act's civil provisions, in general, exhibit a sensitivity to
due process concerns, but modifications are needed.
Civil monetary penalties > The Health Security Act creates
numerous new civil monetary penalty provisions, covering everything from
unreasonable denial or delay in the payment or provision of benefits,
section 5207(a), to misuse of a health security card , section 5141(a), or
breach of confidentiality in the Early Resolution Program, section
5213(g). The Act establishes explicit due process protections governing
the imposition of most of these civil penalties, usually by reference to
section 1128A of the Social Security Act. Section 1128A provides, among
other things, for written notice, an opportunity to be heard on the
record, representation by counsel, presentation and cross-examination of
witnesses and a right to judicial review before civil monetary penalties
may be imposed. 42 U.S.C. 1320a-7a.
In a few instances, however, no due process protections are
included. See, e.g., sections 1345(d), 1374(i), and 1609. A few
provisions state only that the relevant Secretary may bring a civil action
in court to enforce a penalty but provide no details about the court's
standard of review. The ACLU believes that due process protections, such
as those found in section 1128A of the Social Security Act, must be
applied to all civil monetary penalties that may be imposed under the
Health Security Act.
Disqualifications > The Act also establishes numerous grounds for
excluding persons from participating in federal health care programs on
either a mandatory or permissive basis. Sections 4044-45 and 5411. Due
process protections for exclusion determinations are included by
reference to section 205 of the Social Security Act, 42 U.S.C. 405.
However, the Health Security Act includes at least two other types
of disqualification penalties for which it fails to offer any due process.
Section 1404(b)(2) prohibits state certification for any health plan that
provides materially inaccurate information to a regional alliance and
eligible individuals, thus disqualifying the health plan from
participation in the health care system. Section 1375(d) disqualifies
low-income families from receiving premium deductions or reductions in
liability if they fail to file an end-of-year reconciliation statement
without good cause. No procedures are set forth for either determination.
This is constitutionally unacceptable. At a minimum, the Act must
be amended to guarantee process comparable to that for exclusions from
participation. Indeed, the ACLU believes that the disqualification under
section 1375 should be eliminated altogether. Rather than punishing poor
families for failing to file a reconciliation statement, alliances should
be required to provide them with assistance to assure that they can comply
with this technical requirement.
Collection practices > The Health Security Act requires regional
alliances, assisted by the states, to "use credit and collection
procedures ... as may be necessary to collect amounts owed to the
alliance." Section 1345(a). No limitations are stated. Due process
requires that fair collection practices be reasonable under the
circumstances, that they not unreasonably intrude on individuals' liberty
or property, and that all targets of collection efforts receive adequate
pre-collection notice and be afforded an opportunity to contest the
alliance's claim and any penalties that may be imposed.
Misdirected sanctions > A fundamental principle of due process is
that sanctions be imposed only on persons who are legally responsible for
the misconduct that gave rise to the penalty. In at least one instance,
the Health Security Act violates this principle. Sections 1512-13
sanction a state for failing to comply with the requirements of the Act by
reducing the amount of federal payments to academic health centers, health
researchers and hospitals serving vulnerable populations in the state. It
is unreasonable and a violation of due process to punish such entities
(at least if they are not public entities) for the state's noncompliance.
2. Federal Criminal Enforcement
The Health Security Act adds a number of new provisions to the
federal criminal code and, in other respects, expands federal criminal
authority. While the ACLU does not oppose the creation of new federal
crimes per se, we do believe that some of these new offenses further an
unfortunate trend toward the overfederalization of criminal law. We are
also concerned by a provision in the Health Security Act that expands
federal criminal forfeiture authority.
Creation of new federal crimes > Subtitle E of Title V of the
Health Security Act creates at least five new federal criminal offenses:
health care fraud, section 5431; false statements relating to health care
matters, section 5433; bribery and graft in connection with health care,
section 5434; theft or embezzlement in connection with health care,
section 5437; and misuse of the health security card or unique identifier,
section 5438. Whether or not it is wise to create new federal offenses is
beyond th e scope of this report. However, the ACLU is troubled by the
reach of these provisions.
The first four of these offenses each extends to conduct involving
health plans, whether or not it has any effect on an alliance, a state or
any federal interest. In fact, the health care fraud statute reaches any
scheme to defraud any person in connect ion with the delivery of or
payment for health care benefits, items or services. We fear that this
overfederalization of criminal law will burden federal prosecutors and
further clog the federal courts. The ACLU believes that enforcement in
many of these cases should be left to state authorities. The criminal
provisions of the Health Security Act should be narrowed to apply only to
cases in which the federal government has a real interest.
Expansion of criminal forfeiture > Section 5432 imposes mandatory
criminal forfeiture as part of the sentence for certain federal health
care offenses. The ACLU generally opposes both mandatory sentencing
provisions and expanded use of the forfeiture sanction; thus, we oppose
this provision as an unwarranted extension of criminal law. At a minimum,
however, any forfeiture provision cannot be more broadly drawn than the
President's proposal: It extends only to property used in the commission
of the offense or the proceeds thereof, it is limited to an amount
proportionate to the seriousness of the offense, and it is imposed at
sentencing rather than in a separate civil proceeding with lower burdens
IV. FIRST AMENDMENT FREEDOMS
Health care reform also raises important civil liberties issues under the
First Amendment. It implicates both the constitutional right to free
exercise of religion and the right to freedom of speech. Whether they are
patients or providers, people may not be forced to participate in medical
treatment that is in conflict with their religious beliefs or moral
convictions: Providers must be entitled to refuse to perform particular
services as an exercise of conscience, while individuals whose faiths
reject modern medicine must be free to opt out of the health care system
altogether. Separately, a number of the marketing restrictions imposed by
the Health Security Act appear to violate the constitutional right to
freedom of speech, while in other contexts additional protections may be
required to prevent deprivations of that right.
A. FREEDOM OF RELIGION
The right to opt out of the health care system > The
constitutional right to free exercise of religion is implicated by the
requirement that all eligible individuals enroll in health plans. Section
1323. Certain faiths, notably Christian Science, reject conventional
medicine. Practitioners of such religions, and others whose moral or
religious beliefs prohibit them from accepting medical treatment, cannot
be compelled to join a health plan. Rather, as with compulsory military
service, the Health Security Act must recognize the equivalent of
"conscientious objector" status.
Conscience Clause > Patients are not the only ones who possess a
First Amendment right to opt-out based on sincerely held religious or
moral beliefs. Individual health care providers cannot be compelled to
perform medical procedures that would violate t heir personal beliefs or
convictions. Such a government mandate would be a clear violation of the
Free Exercise Clause. Section 1162 of the Health Security Act is,
therefore, appropriately respectful of the personal beliefs of health care
providers when it states: "A health professional ... may not be required
to provide an item or service in the comprehensive benefit package if the
professional ... objects to doing so on the basis of a religious belief or
However, although individual health care providers are properly
protected by section 1162, different issues are raised when institutions
claim a religious or moral right to refuse to provide services that are
part of the mandatory comprehensive benefits package. As currently
written, section 1162 would permit any "health facility" to refuse to
perform a procedure on either religious or moral grounds. This provision
is far too broad because it would allow any health facility to impose its
stated institutional beliefs on patients and individual providers who do
not share them. The provision also does not take into account the serious
Establishment Clause issues that arise whenever sectarian institutions
participate in, and derive benefits from, government-managed and
regulated programs. In addition, an institutional opt-out should not make
it more difficult to fulfill the Act's requirement that every plan provide
a full range of services. In a situation where access to an alternative
facility is impossible or an undue burden upon patients, any
institutional right to opt-out may be outweighed by the patient's right to
necessary medical services. Because these issues are not adequately
addressed, the ACLU opposes section 1162 in its present version.
B. FREEDOM OF SPEECH
The constitutional protection for freedom of speech is implicated
in two basic ways by the Health Security Act. First, some of the consumer
marketing restrictions and requirements imposed by the Act run afoul of
the First Amendment. Second, additional legal protections need to be
adopted to ensure that no person or health care provider is penalized for
exercising her right to free speech.
Marketing practices > The Act contains a number of restrictions on
consumer marketing by health plans and purveyors of long-term care
insurance. Sections 1404 and 2324. Some of these restrictions are
unobjectionable. The government may legitimately regulate commercial
speech in certain ways to prevent consumer fraud, promote health and
safety and prohibit discrimination (such as redlining). However, the
regulations must be narrowly tailored to these ends.
Several provisions in the Act cross this constitutional line.
Most conspicuously, the requirement in section 1404(a)(1) that health
plans submit all marketing materials to their regional alliance for prior
approval must be rejected as an unconstitutional prior restraint on
speech. If a health plan distributes marketing materials that contain
false or materially misleading information, it can be punished for this
misconduct after the fact.
Similarly, the prohibition on cold lead advertising, and the
required disclosures by membership entities endorsing long-term care
insurance policies in section 2324(e)(4) & (g)(2), overreach. While both
provisions appear to be intended to prevent consumer fraud, neither is
narrowly tailored to achieve that end: The former improperly outlaws a
lawful sales technique, while the latter improperly compels speech,
whether or not the entity's endorsement would otherwise be misleading.
Statutory protections for speech rights > First Amendment concerns
are also raised by the absence of certain protections in the Act. Health
plans are prohibited from discriminating on the basis of race or gender,
inter alia, in the selection of provider s for their plan networks.
Section 1402(c)(2). However, nothing in the Act prohibits a health plan
from excluding a provider based on her political beliefs, or from
restricting the exercise of her First Amendment rights as a condition for
participation. Such actions would have a chilling effect on political
participation by health care providers and should be prohibited.
Similarly, the Act currently contains no protections for employees
of health plans or alliances who "blow the whistle" on improper practices
by their employers. Federal whistle-blower protections should be extended
to such people.
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