The little known threat that could change Medicare this August

The Medicare program and seniors’ health benefits face an imminent looming threat unless Republicans and Democrats in Congress can work together to address it — because time is running out.

The threat comes in the form of the Independent Payment Advisory Board (IPAB). The panel of presidential appointees, created under the Affordable Care Act, is charged with making cuts to Medicare if the program’s spending hits a certain arbitrary level. 

{mosads}Up until now, most people haven’t paid much thought to IPAB — in part, because per capita Medicare spending has remained relatively low, and also because President Obama didn’t name anyone to the board.

Experts now predict, however, that spending could meet that threshold in a matter of weeks, triggering IPAB into action and launching a process that will affect care for 55 million seniors and Americans with disabilities. And the fact that there are no actual IPAB appointees should not be seen as salvation for Medicare beneficiaries. In this eventuality, IPAB’s authority transfers to the Health and Human Service Secretary Tom Price.

The issue here is not whether Medicare needs to be improved and made more cost-efficient. Of course, it does. Efforts are already underway to transition the program from its traditional fee-for-service orientation to a structure that emphasizes paying for value. Gradually, steps are also being taken — although more needs to be done — to focus on wellness and disease prevention so we’re spending less to treat the symptoms of seniors with multiple chronic illnesses.

The IPAB concept, though, doesn’t have anything to do with value or keeping beneficiaries healthy. It’s a blunt weapon that demands significant Medicare cuts to be applied over a one-year period in order to bring spending levels back down to legislatively-selected targets. The likely outcome of this process is reduced reimbursements for physicians who treat Medicare patients. That is a significant problem given that Medicare already pays significantly less than private insurance — limiting access to effective, innovative treatments and therapies.

There is also the issue of who should make decisions over Medicare policy. Constitutionally, this belongs in the hands of the legislative branch and, by extension, the American people who vote members of Congress into office. There is a significant problem with transferring this authority to an unelected board whose decisions would not be subject, by law, to administrative or judicial review. 

The good news is that there is a way out of this potentially damaging situation. Democrats and Republicans in both houses of Congress have introduced legislation to eliminate IPAB. There is a provision in the law creating the board that allows Congress to pass a resolution that will shut IPAB down for good. The catch is that this resolution must be passed by August 15 or the opportunity is gone forever. The bipartisan agreement on this issue needs to be quickly translated into essential action.

An Independent Payment Advisory Board is simply out of step with the times in which we’re fortunate to live. Right now, medical science is developing new therapies that can more effectively address chronic conditions like diabetes and heart disease. Evidence-based medicine combined with greater access to health data is empowering doctors to keep their patients well instead of simply treating their sickness. 

IPAB, with its indiscriminate approach to budget-cutting, would shrink seniors’ access to these healthcare improvements, make it more difficult for them to see the doctors of their choosing and, in so doing, increase their use of expensive emergency rooms and acute care facilities. By taking a bad approach to cutting costs, IPAB would actually increase them in the long run.

Congress must do what’s right for tens of millions of Medicare beneficiaries and the sustainability of the program. Bring an end to this bad idea before it can do real harm.

Tommy Thompson is the former Republican Governor of Wisconsin and served as the Secretary of the Department of Health and Human Services under President George W. Bush. Vic Fazio is a former Democratic Congressman from California. He is currently a Senior Advisor at the Washington offices of Akin Gump Strauss Hauer & Feld. 

The views expressed by contributors are their own and are not the views of The Hill.