Controversy heats up over Medicare cost-cutting board


The fight over who will be in charge of keeping Medicare costs in line heated up this week as two House committees held contentious hearings on the subject. Opponents of the Independent Payment Advisory Board (IPAB), a 15-member panel appointed by the president and authorized to cut Medicare spending when it rises above a certain level, say such decisions should be left to Congress.

The board was created as part of last year's health care reform overhaul, and is expressly forbidden from "rationing" care, raising premiums or reducing benefits. Savings would likely come from lowering payments to doctors or drug companies, or reducing subsidies to Medicare Advantage, the arm of the program that provides benefits through private insurers. Recommendations issued would become law unless Congress could find equivalent savings elsewhere, or override the board's decision with 60 votes in the Senate.

Congresswoman Allyson Schwartz, D-Pa., is one of a handful of Democrats who signed on to a bill that would repeal the panel. A strong supporter of the health care reform law, she told the House Energy and Commerce Committee yesterday that she thought other parts of the law would be adequate to hold down costs and that Congress "must accept its responsibility" for finding additional savings elsewhere.

Politicians of both parties regularly raise the alarm over rising health care costs. In May, Medicare officials estimated that the program's trust fund would be bankrupt in 2024, five years earlier than previously thought; health care spending in the US regularly outstrips the rise in GDP.

Legal and legislative challenges to the board have mounted in recent months. The Goldwater Institute filed suit against IPAB on constitutional grounds in April, charging it will usurp Congress' legislative function. Two bills introduced in the House and Senate earlier this year would repeal that section of the health care reform act; a few Democrats have signed on to co-sponsor the House bill.

Last month, the battle of words accelerated as well. Opponents gathered 270 signatures on a letter supporting repeal, including groups representing doctors and other care providers, device and drug manufacturers and some patients' groups. A previous letter supporting IPAB gathered about 100 signers, primarily policy experts and economists.

Among the detractors was a spokesperson for AARP, who told the Sunlight Foundation, "We have serious concerns about any proposal relying on arbitrary spending limits." (The AARP did not sign on to last month's letter supporting repeal.) Supporters say the complexity of health care finance requires a dedicated panel of experts in the field — and they charge that Congress has passed few measures to rein in health care spending in the past.