GUESTWORK | Douglas E. Schoen
The debt ceiling debate didn’t end well for the Democrats. Faced with unified tea party delegates in the House, they were forced to cede huge cuts in federal spending without an iota of revenue increases in the final deal.
It was the right move at the time – reaching a deal averted fiscal catastrophe. But now, Democrats are thirsty for a win, and rightfully so. They need an opportunity to show the American people they’re serious about fiscal reform – but that they’re also uniquely committed to preserving vital public services in the process.
Repealing IPAB – short for “Independent Payment Advisory Board” – offers just such an opportunity. Established last year by the president’s health bill, IPAB has grown increasingly unpopular among the American public and Capitol Hill lawmakers alike. And there’s good evidence to suggest that IPAB will severely undermine the quality of care in Medicare – a key program for the Democrats’ base.
The president should give his party the go-ahead to get rid of IPAB.
IPAB is supposed to make the tough cost-cutting decisions for Medicare that Congress has failed to make. It’s comprised of 15 presidential appointees serving six-year terms. Starting in 2014, if Medicare exceeds a preset annual spending target, the board is authorized to make cut recommendations.
IPAB’s powers are limited – it can’t adjust premiums, cost-sharing arrangements or eligibility requirements. But, the powers it does have are dangerous. Notably, IPAB can slash reimbursement rates of participating healthcare providers.
Medicare’s reimbursements are already dangerous low. Indeed, the American Academy of Family Physicians has reported that more than 12 percent of its doctors now don’t accept Medicare patients because rates are so paltry – and that percentage is rising.
If IPAB makes even more cuts, more doctors will opt out of the program, the pool of available providers will shrink, and patients will face longer wait times to get treated.
Medicare does need fiscal reform. The CBO and the Medicare trustees both predict the program will go bankrupt in less than 10 years. But slashing reimbursements and compromising patient care is the wrong strategy.
What makes the Payment Advisory Board all the more dangerous is that it’s effectively unchecked. Unless Congress passes cuts achieving the same amount of savings, or vetoes IPAB’s recommendations outright with a supermajority vote, the board’s proposals automatically become law. And there is no legal mechanism for appeal available to patients or doctors.
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