Skip to content

Troubling Things You May Not Know About IPAB

March 05, 2012

Buried in Section 3403 of ObamaCare is a powerful board of unelected bureaucrats, the so-called “Independent Payment Advisory Board” (IPAB), whose sole job will be to save money by restricting access to health care for Medicare beneficiaries.  IPAB is required to achieve specified savings in years where Medicare spending is deemed “too high,” according to the Democrats’ health care overhaul.

While few Americans are aware that this ObamaCare rationing board even exists, it embodies the very thing Americans feared most about the law – unaccountable Washington bureaucrats meeting behind closed doors to make unilateral decisions that should be made by patients and their doctors.  A review of  IPAB’s powers make clear that the American people have every reason to be concerned.  Tomorrow, the Ways and Means Subcommittee on Health will convene to hear from stakeholders about the impact this ill-conceived rationing board will have on Medicare beneficiaries and their health care providers.  These are just a few of the items that may come up for discussion:

  • The Democrats did not prevent IPAB from rationing health care.  The Democrats claim they “prevent” IPAB from including recommendations to ration health care.  However, the Democrats chose not to define what they meant by “ration,” and such a definition does not appear anywhere in the Medicare statute.  So, rationing is in the eye of the IPAB beholder.  IPAB would be free to cut reimbursement rates for procedures and services that IPAB deems “unnecessary” to levels so low that no physician would provide the care.
  • The Democrats’ rationing board will threaten seniors’ access to care.  Medicare is already known for its low reimbursement rates (e.g., Medicare physician payment rates are 20 percent lower than what they receive from private health plans), which have forced many physicians to stop accepting new Medicare patients.  IPAB is specifically tasked with cutting provider rates even further.  Countless physician groups have warned these cuts will force many to stop seeing Medicare patients.  Because TRICARE reimbursement rates are directly tied to Medicare, health care for military personnel will be impacted by these cuts as well.
  • Democrats require seniors and Americans with disabilities to pay for IPAB to cut their Medicare benefits.  IPAB’s annual operating budget is raided from the Medicare trust funds.  This means that IPAB’s generous member salaries ($165,300 for members and $179,700 for IPAB’s chairperson in 2012) will be paid directly out of the trust funds used to pay Medicare beneficiaries’ health care claims.  IPAB staff will also be paid out of the Medicare trust funds (up to $145,700 per employee in 2012).  So will all travel expenses and stipends.  What a deal!
  • Democrats gave IPAB blanket authority to operate in secret.  There is no requirement in the Democrats’ 2,200+ page health care law that requires IPAB to hold public meetings or hearings, consider public input on its proposals, or make its deliberations open to the public.
  • IPAB may become the most corrupt entity in Washington.  ObamaCare states that IPAB “may accept, use, and dispose of gifts or donations of services or property.”  This provides a not so subtle invitation for lobbyists to lavish the unelected and unaccountable IPAB members with cash, meals, cars, vacations, or even houses!
  • Democrats provided the President with unchecked power.  Here are a couple of disturbing scenarios:
    • The President uses recess appointments to avoid congressional approval for his IPAB nominations, so the President stacks the deck.  If Congress opposes IPAB’s recommended Medicare cuts, the House and Senate would have to pass an identical bill to override and replace the IPAB cuts.  However, the President may unilaterally decide that IPAB’s cuts are “better” and veto the legislation passed by Congress.  If Congress fails to secure the required supermajority vote to override the President’s veto, then the unelected IPAB’s Medicare cuts become law, over the objections of a majority of elected Congressional officials.
    • If the Senate fails to appoint any members to IPAB (something that is probably more likely than not given recent history), the Secretary of Health and Human Services (HHS), who is appointed by the President, would be responsible for developing Medicare cuts.  Presumably, the HHS Secretary will work in close consultation with the White House.  If Congress fails to override the Secretary’s cuts, they become law.  Alternatively, if Congress does override the Secretary’s cuts, all the President would have do is veto Congress’ bill, and the HHS proposal that the President helped design would become law.  Either way, the scales are tipped in the President’s favor.
  • The Democrats may have anointed a Medicare “king.”  All that’s required to send IPAB’s Medicare cuts to Congress (and perhaps later become law) is a majority of IPAB members present at the time a vote is called.  If the President only appoints, and the Senate confirms, just one IPAB member, that sole unelected office with have complete, unfettered, and unilateral authority to cut Medicare by way of a process that was intentionally designed to tie the hands of Congress.  Is the “Godfather of Rationing,” Don Berwick, available?
  • Nothing prevents IPAB from going beyond its mandate and recommending a package of proposals that cut Medicare even deeper than what Democrats have asked IPAB to do.  More troubling, if Congress is unable to override such a proposal, it would become law.