By 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 composed 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 requires. But, the powers it does have are dangerous. Notably, IPAB can slash reimbursement rates of participating health care providers.
Medicare’s reimbursements are already dangerously 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 fewer than 10 years. But slashing reimbursements and compromising patient care is the wrong strategy.
What makes the 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.
IPAB is just bad policy. And, politically, getting rid of it is a no-brainer. The GOP is all but unanimously against the board. Republicans have formed caucuses in the House and Senate exclusively composed of physicians with the single purpose of getting rid of IPAB.
A recent letter sent to Congress pushing repeal was signed by 270 major health care stakeholders. The American Medical Association recently passed a resolution against the board.
There’s growing opposition among Democrats, as well. Even last year, in the heat of the health care debate, more than 70 congressional Democrats signed a letter to then-Speaker of the House Nancy Pelosi (D-Calif.) urging her to remove the IPAB provision from the legislation.
And just last month, the House Energy and Commerce Subcommittee held a hearing examining the board and two Democrats — U.S. Reps. Frank Pallone (D-N.J.) and Allyson Schwartz (D-Pa.) — broke party lines and voted for repeal. In early August, U.S. Reps. Loretta Sanchez (D-Calif.) and Tim Bishop (D-N.Y.) signed on to the IPAB repeal bill.
The political will is there. The Democrats should cash in on it.
Given that IPAB was part of his health care bill, the president can’t come out and explicitly endorse its repeal. But he can send subtle signals to the Congressional leadership that he won’t veto a bill to that effect.
The president would not be sacrificing any of his legislation’s key components. It still expands the ranks of the insured and installs price-reduction mechanisms. The White House would not be sacrificing anything of consequence by letting IPAB die.
Getting rid of IPAB would bolster Democrats’ reputation as champions of Medicare — that they’re a party that cares about fiscal reform, but not at the expense of our nation’s most vulnerable.
Douglas Schoen is a political strategist and author of Mad as Hell: How the Tea Party Movement is Fundamentally Remaking Our Two-Party System, published by Harper, an imprint of HarperCollins.
From the Sept. 14-20, 2011, issue