There's an IPAB in your future

There's an IPAB in your future

For all of the years that I was privileged to serve as the staff director of the Senate Health Subcommittee, our No. 1 legislative priority was the enactment of Chairman Edward Kennedy's national health insurance bill. Back in those days, health care reform was known as national health insurance (NHI).

We never were able to get the bill passed. We were trapped, like all the other senators who had competing NHI bills, in that we all had enough political strength to block any competing bill but not enough political support to pass our bill. This, of course, was the political impasse that hamstrung the enactment of any such bill until Obamacare became law on March 23, 2010.

For the record, I have been a tireless and unwavering advocate for genuine health care reform since 1971. During the lengthy, bitter and divisive consideration of Obamacare, I advocated that health care reform could best be achieved by extending the 50-year old Federal Employees Health Benefits Program to all Americans on a pay-as-you-go basis.

It is the nation's largest health insurance program. It is funded and administered by the federal government, but the insurance coverage is provided by private commercial insurers or HMOs. All of its participants get to choose their own insurer, doctor and hospital. Thus, it is a successful public/private partnership. Good luck trying to find any one of its millions of participants who is dissatisfied with it.

But President Barack Obama and his Democrat allies on the Hill unwisely chose a different path. It was a path that divided Washington and the nation. It was a path that forced them to sell out to the powerful health care industry in order to get the votes to pass Obamacare. It's a path that loads an additional 30 million uninsured Americans on the USS Health Care Titanic with no additional life preservers or life boats. Maybe you call that health care reform. It's not.

But whether you love Obamacare or hate it, there's something buried deep within it you need to know about: IPAB, the Independent Payment Advisory Board, which, when created, will cut Medicare spending. This new, 15-member government agency was authorized by sections 3403 and 10320 of Obamacare. Its principal job is to cut Medicare expenditures without affecting quality, coverage or the use of rationing. Are you kidding me?

Medicare currently serves about 50 million Americans, and the number is growing rapidly. The baby boomers began to reach age 65 two years ago. By 2029, all 77 million of them will have reached age 65 and be eligible for Medicare. Current Medicare spending is about $600 billion annually. It is projected to rise to $1 trillion by 2022, and the Medicare trustees, in their annual report in the spring, stated that the Medicare Hospital Insurance Trust Fund will become insolvent by 2026. According to the U.S. Debt Clock, Medicare's liability is currently estimated to be more than $86 trillion — that's trillion.

Somehow the IPAB is supposed to fix all of this. It can't be done painlessly, if at all. But even if it could, there are other aspects of the IPAB that raise monumental problems. A thoughtful and thought-provoking column in The Wall Street Journal on June 19 by David Rivkin and Elizabeth Foley makes the argument that the IPAB threatens not just Medicare but also the Constitution's doctrine of separation of powers and due process.

The provisions of Obamacare that create the IPAB ensure that the board will not be subject to administrative or judicial review. In addition, once the IPAB's members are nominated by the president and confirmed by the Senate, they will be insulated. They can only be removed for "neglect of duty or malfeasance in office."

In addition, Rivkin and Foley point out that once the board acts, Congress' ability to overrule its actions is extremely limited and requires supermajority votes. If the board were to fail to make the required Medicare reductions, the law provides a fail-safe mechanism. Under those circumstances, all of the board's power would revert to the secretary of Health and Human Services.

Rivkin and Foley wrote, "This wholesale transfer of power is at odds with the Constitution's separation-of-powers architecture that protects individual liberty by preventing an undue aggregation of government power in a single entity."

The authors also point out that the IPAB is also "encouraged to make rules ‘related' to Medicare." "Related to Medicare" is a loophole through which an 18-wheeler could be driven.

For example, Rivkin and Foley suggest the board could require providers to make available certain services without payment, or it could require insurers and/or providers to make abortion services available, or any other requirement the board deems necessary.

Finally, they conclude that "the Independent Payment Advisory Board isn't a typical executive agency. It's a new beast that exercises both executive and legislative power but can't be controlled by either branch. Seniors and providers hit hardest by the board's decisions will have nowhere to turn for relief — not Congress, not the president, not the courts."

By the way, why is there no IPAB for Medicaid? Like Medicare, its costs are enormous and out of control, and Obamacare will expand it significantly. Perhaps the answer is driven by political correctness — IPAB-ing Medicaid would have made Obama and the Democrats vulnerable to a bogus charge of discrimination.

The Shadow's sweating none of this, he's ageless and has never been sick, but Goldman can be reached at:  EmailMe.