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The last thing that congressional defenders of the Patients' Bill of Rights wanted to hear, as they battled their way to a decisive victory in the House of Representatives earlier this year, was that the same pinstriped gang that successfully sued Big Tobacco was gearing up to mount an offensive against the managed-care industry.

Some proponents of the managed-care reform bill now fear that the highly publicized legal attack could derail the legislation on its way to the president.

"It doesn't make a lot of the proponents of the bill very happy to see these people running after lawsuits," says Dennis Fitzgibbons, a Democratic staffer on the House Commerce Committee, who has been an active supporter of the legislation. "The timing could have been better."

In October, the House voted 275-151 to pass the Norwood-Dingell Patients' Bill of Rights legislation, a sweeping reform package that, among other things, gives HMO members the right to sue managed-care plans that deny them access to care.

The passage was a landmark victory for House Democrats, who -- with the aid of massive public outcry over managed-care abuses -- got a lot of Republicans to support the legislation.

The strongest argument against the Norwood-Dingell package -- that it would create a whole new universe of costly legal warfare that would ultimately benefit nobody but the nation's trial lawyers -- was vehemently refuted by bill supporters, and ultimately failed to persuade moderate Democrats and Republicans to turn against the legislation.

But since then, as details of a coordinated attack against the managed-care industry by some of the nation's top attorneys have emerged, key legislators now appear to be reconsidering the liability provisions contained in the bill.

While that legal offensive is being mounted under existing law, and has little if anything to do with the Norwood-Dingell bill, it has provided opponents of the legislation with a valuable rhetorical tool to use in the ongoing debate.

"The trial lawyers' activity is beginning to make [the] individuals that voted for Norwood-Dingell think again," contends Karen Ignagni, president of the American Association of Health Plans (AAHP). "I see a palpable shift in individuals' thinking." As the HMO industry's foremost trade and lobbying group, AAHP has been an active participant in the managed-care debate.

Moderate House Democrat Cal Dooley agrees with Ignagni's assessment.

"To see what is a very aggressive and coordinated attack by trial lawyers on the [managed care] industry as a whole, you can't be under any illusions that this is not going to cost the health-care system money," says Dooley, D-Calif., who voted in favor of the Norwood-Dingell bill.

Dooley and Ignagni are referring to the revelation, first reported by the Wall Street Journal in late September, that the cadre of attorneys who mounted successful multi-million-dollar class-action cases against the tobacco industry have now turned their eyes toward the managed-care industry.

Class-action suits aren't even allowed under Norwood-Dingell, but the trial lawyer activity belies, to some extent, the argument of the bill's supporters that existing law does not allow patients to sue their managed-care plans. Managed-care companies are protected from a great deal of litigation by the Employment Retirement Income Security Act of 1974 (ERISA), which Norwood-Dingell would amend.

Next page | If timing is everything, this looks bad ...