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IPAB Repeal Urged by 500 Provider and Advocacy Groups

Panel might cut Medicare payments to physicians, critics warn

Saved from Sustainable Growth Rate pay cuts, more than 500 physician groups, other providers, and advocacy organizations have focused their attention on the Independent Payment Advisory Board (IPAB), according to a report posted on the HealthLeaders Media website. The groups are demanding that Congress repeal IPAB, even though Medicare spending triggers that would activate it aren’t likely to be met in this decade.

The 15-member panel, which was empowered by the Patient Protection and Affordable Care Act but has not yet been appointed, is charged with cutting Medicare payments to providers if Medicare spending targets aren’t restricted to certain thresholds.

In a letter sent May 4 to Congress, the organizations wrote that because the IPAB must reach “scoreable savings within a one-year time period,” it is likely to cut payments for health care providers as a short-term solution.

“This would be devastating for patients, affecting access to care and innovative therapies,” the letter said.

“Already, the number of physicians unable to accept new Medicare patients due to low reimbursement rates has been increasing over the past several years (almost one of every three primary care physicians, according to the American Medical Association [AMA], restricting the number of Medicare patients in their practice). IPAB-generated payment reductions would only increase the access difficulties faced by too many Medicare beneficiaries,” the groups wrote.

The letter was signed by dozens of physician groups, including the AMA; by several state hospital associations; by senior citizen groups; by organizations advocating for patients with specific diseases, such as Alzheimer’s disease, acquired immune deficiency syndrome (AIDS), lupus, and epilepsy; by ambulatory surgery organizations; by several state Easter Seal groups; and by many entities that advocate for patients with mental illness.

Michael Freeman, executive vice president of the Healthcare Leadership Council, an alliance of health care companies, hospitals, pharmaceutical manufacturers, and insurers, said that it’s better to repeal IPAB now “rather than wait until it’s at the doorstop chopping away at Medicare expenditures.”

He acknowledged, however, that there is no immediate threat that the IPAB could start cutting payments anytime soon.

The Medicare spending levels necessary to trigger the IPAB’s spending cuts will not be met this year or next, andr possibly not in fiscal year 2017, because Medicare spending has not been growing at its historically rapid pace. A March 2011 document from the Congressional Budget Office (CBO) said that Medicare spending thresholds were not expected to exceed targets through 2021.

“The rate of growth in Medicare spending per beneficiary is projected to remain below the levels at which the IPAB will be required to intervene to reduce Medicare spending. As a result of that reduction in projected Medicare spending, CBO’s March baseline does not include any savings from actions by the IPAB,” the CBO report said.

The fear, however, is that with an increasing number of Americans reaching Medicare age, spending may resume and reach those thresholds despite what the CBO report may have projected in 2011. “There are going to be more baby boomers, and that will invariably result in Medicare spending triggers at some point,” Freeman said.

The IPAB is “prohibited by law from making recommendations that raise revenues, increase cost sharing of Medicare beneficiaries, or restrict benefits and eligibility,” according to a 2013 article in the New England Journal of Medicine. Because of that, if and when the IPAB becomes an active entity, it “is expected to focus on savings from medical providers… Republicans view it as an instrument of rationing and bureaucratic intrusion into medicine.” It will also “shift costs to consumers in the private sector and infringe upon the decision-making responsibilities and prerogatives of the Congress.”

In their letter to Congress, the provider and advocacy groups wrote that “the responsibility for enacting health care system changes of this magnitude would be transferred from the legislative branch to the executive. More specifically, an unelected board without adequate oversight or accountability would be taking actions historically reserved for the public’s elected representatives in the U.S. House and Senate,” which they said is “unacceptable” for millions of seniors and individuals with disabilities that rely on Medicare providers.

The organizations are further concerned that if President Obama does not appoint the board’s members, and if the Senate does not confirm appointees, “the law transfers IPAB’s responsibilities solely to the Health and Human Services Secretary. This places an enormous degree of power in the hands of one unelected individual.”

President Obama’s administration has reportedly said that it has delayed making appointments to the IPAB because they would have to be confirmed by Congress, which would set up a fight or a filibuster. Republican leaders, some of whom have nicknamed IPAB the “death panel,” have refused to recommend any appointees.

Source: HealthLeaders Media; May 7, 2015.

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