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Editorials
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Monday, June 24, 2002



[ OUR OPINION ]

High court offers
patients relief


THE ISSUE

A U.S. Supreme Court decision lets state patients' rights law stand.


THE U.S. Supreme Court ruling this week removes the threat of nullifying Hawaii's patients' rights law, which allows people recourse when denied services by their health insurance providers. In the absence of a federal measure that would allow patients to challenge insurers' decisions, the court's determination at least delivers some protection.

The court upheld an Illinois law, like those in Hawaii and 41 other states, that permits patients to seek an independent opinion when their insurer decides against certain treatment or procedures.

Hawaii's 1998 law provides for appeal to the state Insurance Division if a patient is dissatisfied with a health plan's internal appeals process. A three-member panel -- consisting of the insurance commissioner or the commissioner's representative, a physician who specializes in the branch of medicine involved and a member of a health-care plan other than the one cited in the complaint -- reviews the situation and issues a decision. The law also allows the commissioner to award attorney fees because people may not be able to afford legal representation in challenging insurers, and the cost of an attorney will often exceed the value of the benefits sought.

The high court decided that because a 1974 federal law governing most employee benefit plans was silent on independent reviews, it did not override state laws on such opinions. The ruling could help nearly 70 million people nationwide who buy health insurance from private companies, but leaves more than 60 million whose employers are self-insured with no protection.

Congress last year had been working on legislation that would have established a nationwide system for independent evaluations. The patients' rights bill had been a contentious battle between the House and the Senate, principally over the ability of patients to file suit against insurers. The Senate version would have allowed people to recover unlimited damages for pain and suffering and up to $5 million in punitive damages, which President Bush, Republicans and the insurance industry had argued would increase the price of insurance. Democrats contended that the House measure would provide too much protection for insurance companies.

A conference committee was poised to work on a compromise. However, the legislation was put on hold after the Sept. 11 attacks and there has been little movement since then to renew discussion.

The case underscored the differences between patient advocates who want insurance companies removed from medical decisions and the industry that wants limits to keep costs under control. Because varying state laws make matters of health care difficult for both patients and providers, Congress should get back to work on the issue.


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Further talks could
save Internet music


THE ISSUE

A royalty rate Internet companies must pay to record labels has left all sides dissatisfied.


A government decision on the price of online music royalties is drawing no applause and may provide impetus for a negotiated compromise that would better serve all sides. Otherwise, small Internet broadcasters may be forced into extinction during the Web's adolescence. Those embroiled in the dispute would be wise to return to the bargaining table.

Congress agreed four years ago to require Internet radio stations to pay royalties to performers, maintaining the exemption of AM and FM broadcasters. The failure of record companies and Internet broadcasters to reach agreement moved the dispute to arbitration. The librarian of Congress made the final decision that Internet broadcasters would have to pay 70 cents a song in royalties for every thousand listeners.

The amount was only half of that proposed by the arbitration panel. The recording industry says it is below fair market value, but it is far more than what many Internet-only broadcasters can afford. Robert Abbett, aka Rabbett, says it will cost him $13,000 a year to continue broadcasting Hawaiian songs on Internet Radio Hawaii from a spare bedroom in his Kailua home. "I feel like we're really getting railroaded, and I'll hold out as long as I can," he says, but adds, "It very well could mean the end."

In a letter to the librarian's general counsel in March, Rep. Patsy Mink expressed concern that the proposed rates would imperil this "exciting new form of broadcasting." The dismay by Mink and other members of Congress leaves open the possibility of further legislation.

Like radio stations, Internet broadcasters already pay a royalty of 3.5 percent of their total revenues to songwriters and publishers of a piece of music. However, the additional fee that they must now pay to the performers and record companies is not paid by radio stations because of the promotional value that the companies place on their products being heard on the AM and FM airwaves. A curtain call seems needed for all sides to find a better solution.



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Published by Oahu Publications Inc., a subsidiary of Black Press.

Don Kendall, Publisher

Frank Bridgewater, Editor 529-4791; fbridgewater@starbulletin.com
Michael Rovner,
Assistant Editor 529-4768; mrovner@starbulletin.com
Lucy Young-Oda, Assistant Editor 529-4762; lyoungoda@starbulletin.com

Mary Poole, Editorial Page Editor, 529-4790; mpoole@starbulletin.com
John Flanagan, Contributing Editor 294-3533; jflanagan@starbulletin.com

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