Last week, 31 senators including John Cornyn (R-TX) and Orrin Hatch (R-UT) introduced a Senate bill to repeal the Independent Payment Advisory Board (IPAB) provision of the Affordable Care Act. This bill follows the reintroduction of H.R. 351, the Protecting Seniors’ Access to Medicare Act by Representatives Phil Roe (R-TN) and Allyson Schwartz (D-PA) which also seeks to repeal the controversial board. The IPAB was introduced as a panel of appointees to make Medicare cost-containment recommendations to Congress. However, as policymakers from both sides of the aisle have noted, Medicare beneficiaries, the economy, and American democracy may suffer if the IPAB goes into effect. Why is IPAB the wrong solution for Medicare?
- Diminished Health Care Quality and Access—If IPAB takes effect, reduced payments to physicians for the services they provide may create perverse incentives for them to opt-out of Medicare participation. With fewer available doctors, health care quality and access will become more difficult for Medicare beneficiaries.
- Strains the Relationship between Patients & Care Givers—As bill co-sponsor, Senator Orrin Hatch (R-Utah) said in his statement, “Instead of putting patients and doctors in charge of personal health care decisions, the IPAB empowers government and leaves the tough medical choices up to unelected Washington bureaucrats." The link between medical providers and patients stands at the center of the U.S. health care system. That relationship must be strengthened and supported, not threatened by a panel of appointees that cannot be held accountable for their decisions.
- Stifles Innovation—Reimbursement cuts established by the IPAB will effectively serve as price controls which hamper the ability for future innovation. The harm posed by inappropriate pricing mechanisms extend beyond the biopharmaceutical industry as the effects eventually reach Medicare beneficiaries and the public. As with other kinds of price controls, lost revenues caused by IPAB cuts pull resources from elsewhere in biopharmaceutical budgets and result in cuts from groundbreaking R&D research. Without this research patients lose access to necessary, innovative, and cutting-edge treatments.
- Lacks Transparency and Accountability— The IPAB creates a democratic deficit by supplying a group of independent advisors with significant power over the Medicare system, obfuscating who can be held accountable to the public. In practice, the “independent” nature of the IPAB would afford seniors no means of effective recourse if the IPAB makes decisions that result in seniors losing access to vital medical services.
IPAB harms nearly every principle guiding health care provision: affordability, accessibility, and accountability. These bills represent an important push towards removing this potential barrier to care. As discussions about health care costs continue, we look forward to working with other stakeholders in the health care space to develop a sustainable health care system without resorting to measures that inevitably hurt patient’s access to quality care.