Douglas Holtz-Eakin, President, American Action ForumHouse Committee on the Budget Hearing - The Future of Medicare: An Examination of the Independent Advisory Board (Testimony) Thursday, July 14th, 2011
“The Independent Payment Advisory Board (IPAB) is a dramatic policy error that will fail to deliver meaningful reform to the Medicare program.”
The creation of the Independent Payment Advisory Board (IPAB) is possibly the most dangerous aspect of the Patient Protection and Affordable Care Act. It should be repealed immediately.
This appointed panel will be tasked with cutting Medicare spending, but its poor design will prove ineffective in bending the cost curve, and instead will lead to restricted patients’ access and stifled innovation. Four design elements stand-out as especially troublesome.
First, the board is prohibited from recommending changes that would reduce payments to certain providers before 2020, especially hospitals. Because of directives written into the law, reductions achieved by the IPAB between 2013 and 2020 are likely to be limited primarily to Medicare Advantage (23 percent of total Medicare Expenditures), to the Part D prescription drug program (11 percent), and to skilled nursing facility services (5 percent).1 That means that reductions will have to come from segments that together represent less than half of overall Medicare spending. READ FULL ARTICLE