New “Rationing Board” Threatens Health Care Access in America

It’s been called many things: “The real death panel,” “a rationing board,” “RationCare,” even “the royal road to socialism.”

Douglas Holtz-Eakin, a former director of the Congressional Budget Office calls it a “dramatic policy error” and warns that it will mean de facto rationing of health care in America. “It will effectively determine that patients should have coverage for one particular treatment option, but not another, or must pay much more for one of the treatment options.”

“It” is the Independent Payment Advisory Board (IPAB), a new supreme authority over Medicare spending in America that was created by the health care overhaul law passed in 2010 by Congress. IPAB is a panel of 15 experts appointed by the president with authority to cut Medicare payments according to targets prescribed in the law. Starting in 2015, its annual “recommendations” will have the force of law. They are not subject to appeal or to judicial review.

Congress can override IPAB edicts but only if it can muster a three-fifths supermajority in the Senate and win presidential approval for a substitute cost-cutting plan.

Former White House budget chief Peter Orszag calls the health care spending board a “very promising structure” for limiting Medicare costs. He counts it a virtue that IPAB’s decrees are very hard for Congress to overturn. “Radical as it sounds,” says Orszag, “we need to counter the gridlock of our political institutions by making them a bit less democratic.”

IPAB succeeds at that, and then some. Diane Cohen, an attorney for the Goldwater Institute, which is challenging IPAB in court, has blasted the health care law’s creation of IPAB as “the most sweeping delegation of congressional authority in history....”

The office of Sen. Tom Coburn (R-OK) warns that “There are virtually no checks on the panel, since its members are not answerable to voters and its recommendations cannot be challenged in court…. Many expect that in efforts to control spending, the panel will limit patient access to medical care.”

While the law does prohibit IPAB from rationing health care, it’s hard to imagine any other outcome from IPAB price controls. As payments decline, doctors will be forced to drop out of Medicare or withhold some medical services—and that will leave Medicare patients standing in line or going without.

“Huge reductions in care”
Even Health Secretary Kathleen Sebelius admitted that IPAB cuts could hurt seniors. Asked in a 2011 House hearing if IPAB-ordered payment reductions could mean longer waits for dialysis services, Sebelius replied: “Mr. Chairman, as you know, any cut in services … could mean huge reductions in care that seniors would have the opportunity to receive.”

Measures to repeal IPAB have been introduced in both the House and Senate. House passage seems certain, but the outcome is in doubt in the Senate where just 32 members have co-sponsored the “Health Care Bureaucrats Elimination Act.”

Click here to add your name to a petition calling on Congress to repeal the Independent Payment Advisory Board.