Press Release

For Immediate ReleaseContact:  Jim Campi
January 23, 1998

           (202) 467-5300


(Washington, D.C.) – Citizens Against Government Waste (CAGW) issued the following statement today at a briefing on the Medicare Beneficiary Freedom to Contract Act (S. 1194/H.R. 2497).  The statement was delivered by Elizabeth Wright, Director of CAGW’s Health and Science Division.

“I am pleased to be here representing the members of Citizens Against Government Waste and to join these individuals and the organizations they represent to discuss Section 4507 of the Balanced Budget Act.

“We have notified our membership, many who are 65 or older, about this issue and frankly, they are furious. They are enraged that this Congress passed a law that effectively denies them the ability to personally pay for a medical service.  They are tired of the patronizing attitude that seems to be pervasive in Washington, DC  -- seniors are incapable of making wise decisions.  They are horrified that Section 4507 takes away a basic Constitutional right.  They are outraged that as of January 1, 1998, citizens in Great Britain have more rights when it comes to healthcare choices then they do.  Britons can choose to “go private” for their medical care any time they choose.  Not our senior citizens – they need to be baby-sat by Congress and HCFA bureaucrats.

“Citizens Against Government Waste finds it ironic that no similar restriction exists in any other government-run healthcare plan – not Medicaid, not the Indian Health Service, not the VA, not even the Federal Employees Health Benefit Plan that covers Members of Congress and I am sure, many of the Congressional staff that are sitting here today.  Suppose you, or your boss, wants complete privacy when it comes to obtaining a health service.  You can choose to personally pay for that medical service and your doctor will not be banned from providing service to other participants in the FEHBP.  Yet, this Congress has denied our senior citizens that same right.  Since the Contract With America is suppose to guarantee that any law passed by Congress should apply to Congress as well, we are wondering which member of Congress will be brave enough to introduce a bill that puts the same restrictions on their healthcare plan?

“Many believe that Section 4507 is somehow better than what existed before passage of the BBA.  We respectfully disagree.  It is far worse.  Kent Masterson Brown and the doctor and patients he represented in Stewart v Sullivan proved that there was no law that prevented a Medicare beneficiary from entering into a private contract with their

doctor for a medical service.  The law was mute on the subject.  With passage of the BBA, Section 4507 now codifies the right to enter into a private contract BUT ONLY IF THE DOCTOR AGREES NOT TO ACCEPT PAYMENT FROM MEDICARE FOR TWO YEARS.  And so, while the BBA guarantees private contracting, it takes it away at the same time because very few doctors will choose not to participate in Medicare for two years.

“Many believe that Section 4507 only applies to Medicare covered services.  We respectfully disagree.  As was pointed out earlier today, Section 4507 says any item or any service.

“Some will point out that HCFA has sent out guidelines that guarantees Section 4507 only applies to Medicare covered services.  We respectfully remind you that guidelines are that, guidelines.  They are not regulations, they are not law and they can be changed tomorrow.

“More than 5000 CAGW members have joined as citizen co-sponsors of the Medicare Beneficiary Freedom to Contract Act.  This bill will once again return a basic right to our senior citizens.

“Some say this issue is about selfish, money-grabbing doctors and has the potential for increased fraud.  Citizens Against Government Waste, an organization that has taken the lead in fighting Medicare fraud, disagrees.  The Kyl-Archer Bill provides more than adequate protection for patients and enforcement tools for HCFA.  This battle is really about fighting government intrusion into private lives and restoring fundamental Constitutional rights of liberty and privacy to a certain group of Americans - the elderly - allowing them to spend their own money anyway they choose.  There are few things more sacred and private than the relationship that exists between a patient and their doctor.  Section 4507 greatly destroys that relationship.

“Medicare is going broke and is in dire need of significant reforms before the Baby Boomers begin to use the program.  Section 4507 is only one of the many symptoms of a government program that needs to be fixed.  Instead of putting more restrictions on our senior citizens, we suggest that Congress incorporate marketplace concepts to change Medicare and make it look more like their healthcare plan.  After all, if it is good enough for them, why not our senior citizens?”


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