IPAB Repeal: Why It Continues to Matter

Defense of the Independent Payment Advisory Board (IPAB) has grown weak with time.  It was once hailed as a mechanism that would put real teeth into the effort to reduce healthcare spending, making the tough cuts that Congress didn’t have the intestinal fortitude to carry out.  Now, though, its advocates say that IPAB is just a harmless ol’ bear that will just keep hibernating since per-capita Medicare spending has slowed considerably.

Reassurances that IPAB is likely to remain dormant for years, because Medicare spending increases won’t hit the statutory level to force the 15-member board of political appointees into action, doesn’t suddenly make it a good, or even acceptable, idea.  It remains a fatally flawed concept, designed to make indiscriminate cuts in what Medicare pays for healthcare goods and services without adding value or long-term sustainability to the program.  If our goal is to hit short-term spending targets without making Medicare more quality-focused or cost-effective, then IPAB is one heck of a tool.

We shouldn’t be lulled by the current lack of IPAB appointees or comparably low Medicare spending levels into setting aside a repeal effort.  Left in existence, IPAB continues to be a bad excuse – but an excuse, nonetheless – for avoiding genuine Medicare reforms.  Why pursue structural changes to Medicare that might achieve greater cost-efficiencies when we already have a spending-reduction weapon assembled, poised and ready?

Today, over 500 organizations representing patients, healthcare providers and employers sent a letter to Capitol Hill urging the elimination of IPAB.  Their arguments are correct.  This board assumes powers that are intended for Congress and will reduce healthcare access through provider cuts rather than by improving delivery and payment systems.

Given comparably low Medicare spending rates and the lack of IPAB nominations, one could certainly make the argument that the board is the bureaucratic equivalent of a hibernating bear.  The logical response is that, hey, it’s still a bear and you don’t leave open the possibility that it could eventually do significant damage.  Medicare does need strengthening and stability, but a panel of 15 political appointees empowered to do little more than shred budgets is not the answer.  The imperative remains to repeal IPAB and then start to work on actual Medicare reform.