Special interest groups are spending millions this fall to pass or defeat more than 150 state ballot initiatives affecting healthcare in 11 states. The Nov. 2 measures ask voters to decide on everything from increasing cigarette taxes to fund healthcare programs to supporting stem-cell research and curbing medical malpractice settlements.
Healthcare topics constitute less than one-eighth of this year's 163 state ballot measures, according to the National Conference of State Legislatures, a Denver-based bipartisan organization serving the staffs and legislators of all 50 states. Twenty-four states allow initiatives or referendums on the ballot.
Some of the referendums and initiatives directly affect hospitals. They include a $50 million Rhode Island bond issue to fund a biotechnology and life sciences center; two California measures to renovate and expand children's hospitals and fund emergency services through a surcharge on telephone services; and tort-reform proposals in four states. However, a number of others indirectly affect hospitals by making more money available for healthcare services or expanding insurance coverage to the uninsured.
Western states dominate in ballot initiatives. Alaska, California, Colorado, Montana, Nevada, Oregon and Wyoming are floating the greatest number of prospective laws and state constitutional amendments. Florida, Nebraska, Oklahoma and Rhode Island also will have healthcare measures up for a vote.
California tops list
As expected, the nation's most populous state-California-again leads the pack with five propositions. If all pass, they would cost Golden State residents an additional $24 billion over the next 30 years, according to an analysis by the National Conference of State Legislatures, or NCSL, and the California HealthCare Foundation. A referendum to overturn a controversial employer-mandated health insurance law signed last year by former Gov. Gray Davis in the waning days of his administration has attracted more than $10 million in donations both from opponents and supporters of the measure. But proposals to expand state funding for stem-cell research and a telephone surcharge to finance emergency physician and hospital services are also igniting controversy.
Joy Wilson, health policy director for the NCSL, says a number of measures around the country attempt to amend state constitutions, while others seek authorization for funding bond issues or new programs or taxes.
"Most of these are only reported on by local and state media," Wilson says. "But some of them have national implications. The California referenda, medical marijuana issues, tort reform and Florida parental-reporting initiative have drawn national attention."
American Hospital Association spokesman Richard Wade says some of the ballot initiatives reflect providers' growing frustration with congressional gridlock, particularly on medical malpractice issues.
"Doctors and hospitals are becoming increasingly disturbed that they haven't gotten any traction in Washington," Wade says. Reflected in that liability crisis, he adds, is a public feeling that providers need to be more transparent in notifying patients of adverse events, a component in one of the proposed malpractice reform initiatives.
"A lot of hospitals are already putting into place policies to notify patients of adverse incidents," he says. "When hospitals are more forthcoming with patients, they reduce the chance of lawsuits."
Wade says the escalating uninsured crisis is spawning ballot measures such as the California initiative seeking to raise $500 million annually from telephone surcharges to fund emergency care. Referendums in Colorado, Montana and Oklahoma seek to increase taxes on cigarettes to fund public healthcare programs, such as expanding the states' children's health insurance programs.
"These ballot measures bubble up as states and their providers try to take care of people left out," Wade says. "The California measure reflects physician frustration with our emergency-care system. Doctors are getting battered on every reimbursement front," he says. "They're refusing to accept on-call assignments and it's getting difficult for hospitals to find physicians to do on-call work. Something's got to give."
Pressing the reset button
In Colorado, the Legislature took the unusual step of passing a bill that would potentially alter the effect of a referendum increasing cigarette and other tobacco product taxes for the first time in 18 years. Arturo Perez, a fiscal analyst with the NCSL, says Colorado legislators are balking at inflexible spending mandates that crimp their ability to react to changing budget and economic conditions.
Perez says the ballot measure earmarks money that the Legislature does not wish to see restricted. So if the referendum passes, the Legislature can approve what it calls a "reset button" that would reduce to zero healthcare appropriations for one day, allowing the Legislature discretion on how to appropriately spend the estimated $175 million raised by the tobacco tax increase. "It is unique," Perez says. "But they have a legal opinion supporting it. The Legislature may choose to leave the tax increase appropriations as is, or it may make changes."
Opponents of the referendum argue that the tax increase may cause hardships to low-income families and that reductions in product sales could reduce funding to local governments. Some have said the issue could end up in court.
In California, Larry Levitt, vice president of the Menlo Park-based Kaiser Family Foundation, says nurses, unions, consumer groups and the California Medical Association have been outspent 3-to-1 by large employers and restaurant chains in their effort to undo last year's employer health coverage mandate legislation by referendum.
He says that law passed by the California General Assembly would not take effect until 2006 if the voters back the law in the referendum.
In the latest poll by Field Research Corp. released Oct. 11 on voter positions toward the California ballot measures, prospective voters were surveyed on the employer insurance mandate that would require employers of more than 50 people to provide health insurance and found they favored passage 45% to 29%. The California HealthCare Foundation, a philanthropic foundation created in 1996 by a Blues plan conversion to for-profit status, commissioned the survey.
"There are legal clouds over this legislation," Levitt says. "Regardless of the referendum to overturn it, the law will be challenged in court. The legislation is quite modest and won't come close to solving the problem of the uninsured in California."
Levitt says most estimates show the em-
ployer mandate would cover only about 25% of the state's 6.5 million uninsured residents. Employers estimate that the bill would cost them an additional $7 billion by the year 2007.
Jan Emerson, a spokeswoman for the California Healthcare Association, says the CHA endorses the employer healthcare insurance mandate that restaurants and employer groups are seeking to overturn.
"We support Proposition 72 and think the legislation should stay in place," Emerson says. "It does not solve all the problems of the uninsured, but it's a good start. And if it is not overturned, legislators will introduce legislation to address some of its flaws. We believe every individual and employer should take a measure of responsibility for their healthcare."
Emerson says the CHA has not opposed a ballot measure seeking to fund children's hospitals but supports an approach that would help all hospitals. The CHA took a neutral position on the proposition, which is backed by the California Children's Hospital Association.
"The money from this referendum is aimed at capital improvements for children's hospitals to retrofit for seismic-safety standards that kick in three years from now," she says. "The price tag for all California hospitals to comply with these standards is $24 billion and there's been no state money for that. All of the state's hospitals have these needs and we think rather than addressing the issue in a piecemeal fashion, we need a statewide solution. The problem is bigger than just children's hospitals."
Voter support for that proposition remains positive but has declined since August polls conducted by Field Research.
California hospitals also would likely receive about $200 million if an initiative to expand mental health services passes, Emerson says. That measure calls for an increase of about $750 million in state funding to go to counties to support expanded mental health services financed by a 1% personal income tax increase on people earning more than $1 million annually. She says the CHA is sharing the trenches in support of the measure with one of its frequent critics and opponents, the Service Employees International Union. "Politics makes strange bedfellows," she adds.
The mental health funding bill continues to track well in voter polling, according to a Field Poll. Only 25,000 to 30,000 Californians earning more than $1 million annually would pay to fund the bill, which would help an estimated 2 million residents. There is no organized opposition to the proposition.
Meanwhile, California healthcare providers, including the California Medical Association, California Primary Care Association and California Emergency Physicians, as well as professional firefighter unions, are backing a measure to fund emergency care by generating about $500 million annually through a 3% telephone surcharge. A coalition that once included the CHA has worked for two years to build public support for the initiative. But the CHA, after raising $2.4 million to fund the campaign, learned it would have needed to spend another $5 million and dropped out after polls showed a decline in public backing.
Telecommunications companies and antitax activists vowed to spend $20 million to fight the measure and appear to be winning the public relations battle, with an Oct. 11 survey showing widespread voter opposition to the measure.
"The sole reason we withdrew was the poor polling numbers," Emerson says, noting that the CHA board also voted not to take a position on a measure to spend up to $3 billion to fund stem-cell research and create the California Institute for Regenerative Medicine.
"The stem-cell program could be an opportunity for some of our academic medical center members, but there are a number of ethical issues and concerns tied to it, and the measure has no connection to the daily provision of care, so our board took no position."
Actor Michael J. Fox, who has Parkinson's disease, will appear in TV ads promoting the proposition, and George Shultz, Ronald Reagan's former secretary of state and a Republican elder statesman, says he's backing the measure. Last week, Gov. Arnold Schwarzenegger announced his support. Earlier this month, the California Nurses Association, which says it supports stem-cell research in principle, announced it would oppose
the measure, aligning itself with the state's Republican Party and some pro-life groups.
The California HealthCare Foundation and the Center for Governmental Studies released an Oct. 5 report indicating nearly $51 million has been spent to support or oppose the five healthcare referendums on the state's November ballot. Proponents of the measures have raised $5 million for the children's hospital funding project, $3.6 million for the mental health referendum, $6.2 million for emergency services, $16 million for stem-cell research and $5 million for the employer health insurance mandate measure.
Opponents have collected nothing to fight the children's hospital proposal, $6,000 to battle the mental health initiative and $155,000 to fight the stem-cell research funding plan. Parties opposing the phone surcharge for emergency services have raised $7 million, almost all of it from telecommunications firms, while opponents of the health insurance law have raised $8 million, mostly from restaurant chains and the state restaurant association. Opponents of the employer health insurance mandate and the phone surcharge to support emergency services contend the propositions will raise taxes and the cost of doing business in California without solving the problem. Employers say schools will be hard hit by the program and opponents said the mandate, which they estimated would cost workers $1,700 per year, could force more employers to cut jobs and drop insurance coverage.
Treating medical malpractice
Medical malpractice reform continues to be a hot topic as state physician and hospital associations and insurers seek the relief that fed-eral legislators have been unable to provide. Changing tort laws will fall to voters in Florida, Nevada, Oregon and Wyoming. In those states, trial lawyers and consumer groups are squaring off against physicians, hospitals and health insurers, trading accusations of greed and negligence in high-priced advertising campaigns designed to sway voters.
The Oregon and Wyoming proposals cap damages, while Nevada's removes exemptions from its current $350,000 cap and sets limits on attorney fees. A statewide poll commissioned by the Wyoming Medical Society of 500 registered Wyoming voters likely to vote Nov. 2 showed more than 60% support for each of the medical malpractice reform initiatives in that state: one to cap noneconomic damages and the other to establish medical review panels to review malpractice cases. Susie Pouliot, associate executive director of the Wyoming Medical Society, says voters have a strong recognition of what's at stake: "Keeping doctors in Wyoming and keeping healthcare costs down," Pouliot says. "People realize there's a problem and for the first time voters said affordable healthcare is the No. 1 issue, before jobs and the economy."
The American Medical Association, which has pushed unsuccessfully for federal tort reform for nearly a decade, has lobbied heavily for the state initiatives, dispatching leaders, staff organizers and cash to rally the vote. President John Nelson says the AMA has gotten involved because the "broken liability system is threatening patient access to their physicians."
Nelson says the AMA has been frustrated by the inaction of the U.S. Senate to bring tort reform to its floor for discussion.
"We're not getting what we want there, so we're going to the next venue: the states," the Salt Lake City obstetrician says. "If we have to do it 40 to 50 times we will. It takes a lot of time and money, but it's working."
Nelson says AMA leaders and staffers, at the request of the state associations, have attended gatherings in hospitals and community groups, made appearances at the editorial board meetings of local newspapers and have given drive-time radio interviews, "anything they think we should do," he says. "We want to be at the side of our colleagues in this fight."
More ballot battles in Florida
David Williams, chief executive officer of Regional Medical Center-Bayonet Point in Hudson, Fla., says he supports a cap on trial lawyer fees (Amendment 3 to the Florida Constitution on the state's Nov. 2 ballot) but opposes two other amendments. Amendment 7 requires doctors and hospitals to make public information relating to medical errors, physician credentialing and patient safety, while Amendment 8 revokes the Florida medical licenses of physicians who have committed three or more incidents of medical malpractice.
"Amendment 3 will allow injured patients to keep more of an award in a medical liability case, discourage trial lawyers from filing frivolous lawsuits and encourage quality physicians to keep practicing in Florida, thereby improving patients' access to the best and most affordable healthcare," Williams said in a letter to Modern Healthcare.
Williams wrote that Amendments 7 and 8 are "thinly disguised attempts by the trial lawyers to help themselves in litigation and settlements, and do not help patients." He said "Amendment 7 allows trial lawyers to force their way into the internal reviews that hospitals use to evaluate and improve patient care in order to misuse this information for lawsuits." He said Amendment 8 would "force doctors who perform high-risk procedures to consistently settle nonmeritorious claims with trial lawyers rather than risk a finding that could endanger their ability to practice."
In 2003, the Florida Hospital Association successfully lobbied to pass a tort reform bill that imposed a $500,000 cap on noneconomic, or punitive damages. That bill was signed into law last year by Gov. Jeb Bush.
FHA general counsel Bill Bell says the association has not taken a position on the amendment capping attorney fees, but says Amendments 7 and 8 could greatly harm hospitals and physicians by driving specialists to other states and providing trial lawyers with confidential peer-review information they could use against hospitals and physicians in lawsuits.
"We already have shortages of specialists in obstetrics and neurosurgery and have serious concerns that we'll lose even more doctors who won't sit around and wait for another strike against their licenses," Bell says. "This is a ploy by trial attorneys to get physicians to settle cases rather than risking their medical licenses and we think it's terrible public policy. This is not a way to get rid of bad doctors."
Bell says Amendment 7 brings "ambulance-chasing into the hospital and will stifle critical self-analysis that should be kept confidential. This is not healthy for the future of patient safety in Florida."
Bell says the FHA has not taken a position on the amendment requiring providers to notify the parents or guardians of minors before the termination of pregnancies. Bell says the association has not discussed that bill's implications for hospitals.
No less controversial are measures in two states-Montana and Oregon-offering voters a choice to legalize medical marijuana. The Oregon initiative would create state-regulated dispensaries selling the drug to cardholders and allow naturopaths and nurses to sign patient requests for the drug. But an Alaska referendum on legalizing marijuana doesn't even require that the drug be used for medical purposes. That initiative would remove civil and criminal penalties for those over the age of 21 who grow, use, sell or give away marijuana or hemp products and open the door for the state to regulate it. The proposal does remove state restrictions on the physician prescription of marijuana but allows for laws to limit its use in public.
Meanwhile, some states without healthcare ballot measures are seeing healthcare crop up as an issue in judicial elections.
Ohio and West Virginia state hospital associations have lobbied heavily in state Supreme Court justice elections. Ohio Hospital Association spokeswoman Mary Yost says the Supreme Court elections affect the state's physicians and hospitals because of the court's historic role in obstructing tort reform. "This election will strongly impact the future of healthcare in Ohio," Yost says. She says the state is suffering a liability insurance crisis, but not because the Legislature has failed to act.
"Three times in three decades our Legislature has passed tort reform laws, only to see them overturned by the Supreme Court," Yost says, noting that the Ohio State Medical Association is also weighing in on the state Supreme Court elections.
In West Virginia, meanwhile, the state hospital association is supporting Republican challenger Brent Benjamin against current Justice Warren McGraw for a Supreme Court seat. The association contends that McGraw is a known opponent of medical liability reform and has voted twice to strike down a $1 million cap on noneconomic damages.
-Modern Healthcare reporters Laura B. Benko, Vince Galloro, Joseph Mantone and Jeff Tieman contributed to this story.
HEALTHCARE AT THE BALLOT BOX
Selected Nov. 2 state ballot measures
Alaska, Montana and Oregon
* Medical marijuana: Legalizes use of marijuana under certain circumstances or expands existing medical marijuana laws.
* Funding for emergency room services:
A 3% surcharge on telephone services to fund physician and hospital ER care.
* Mental health services funding: A 1% income tax on employees earning more than $1 million yearly.
* Funding for children's hospitals: A bond issue to fund the seismic-safety retrofitting of children's hospitals.
* Employer health insurance mandate: Requires employers with more than 50 employees to pay for health insurance.
* Stem-cell research funding: Would establish California Institute for Regenerative Medicine.
Colorado, Montana and Oklahoma
* Tobacco tax increases to fund public health programs.
Florida, Nevada, Oregon and Wyoming
* Medical malpractice reform: Seeks to cap noneconomic damages and/or reduce attorney fees.
* Pre-termination parental notification for minors seeking to have an abortion.
* A $50 million bond issue to fund a new University of Rhode Island Center for Biotechnology and Life Sciences.
Sources: National Conference of State Legislatures; Modern Healthcare reporting
What do you think?
Write us with your comments. Via e-mail, it's [email protected]; by fax, 312-280-3183.