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Too risky to leave Medicare in agency’s hands

Last week, Congress heard testimony on a lawsuit that challenges the constitutionality of a controversial component of the new federal health care reform law – the Independent Payment Advisory Board. IPAB is a new federal agency comprised of 15 members appointed by the president and confirmed by the Senate, and its sole purpose is to reduce Medicare spending in years that the projected Medicare growth rate exceeds the targeted amount. Despite any outcome of the pending lawsuit, Congress should act now to repeal this dangerous provision that stands to threaten the quality of health care to Medicare beneficiaries.

While the agency won’t necessarily have the power to make any structural changes to Medicare, it will have the ability to reduce direct reimbursement rates to health care providers. Current rates are already causing many doctors to restrict the number of Medicare patients they accept or refuse to accept any at all. Further reductions will only worsen this situation and will likely force some physicians out of business, leaving Medicare patients with fewer options, especially in rural areas. In addition, the agency’s reach could affect payment rates for skilled nursing facilities in 2015, diminishing the quality of care available to seniors in Indiana and across the nation.

Furthermore, there is little to prevent the agency’s authority from becoming absolute as its cost-cutting actions will be automatically implemented unless Congress is able to act and adopt alternative proposals that result in an equivalent level of savings. The four-month congressional review period and three-fifths super majority veto requirement in the House and Senate will mean that virtually none of the agency’s acts would actually be overturned.

In theory, an independent group designated to help cut Medicare spending would seem to be a productive step. In its current form, however, the agency has the power to do more harm than good as it places a great deal of authority in an insulated and unelected board that will make decisions at the expense of Medicare recipients who have no recourse or opportunity to appeal the panel’s draconian acts.

The future of Medicare should not be in the hands of a panel of Washington, D.C insiders at the expense of Medicare beneficiaries. I hope that Indiana’s delegation will join in a bipartisan way to either eliminate the agency altogether or revamp it such that it is forced to function in a much more accountable, responsible and transparent way.

Scott Tittle is president of the Indiana Health Care Association. He wrote this for Indiana newspapers.