IPAB Has to Go, Providers and Advocates Urge

Some 500 healthcare provider groups and companies, patient advocates and employers on Thursday signed a letter to Congress urging repeal of the Independent Payment Advisory Board in fear that not only will its cost-cutting powers hurt patients' access to care, but that it will also raise costs for employers, and actually raise costs in the long run.

"Beneficiaries should have access to high quality care that emphasizes wellness and prevention (and…) programs should be sustainable, so today's working households know it will be there for them in the future," said Mary Grealy, president of the non-partisan Healthcare Leadership Council, a Washington, D.C. group that organized the letter.

However, she said, "The IPAB concept does not bring us closer to these Medicare goals. In fact there is a strong body of evidence telling us that IPAB will actually undermine healthcare quality and accessibility."

The council represents about 50 diverse health companies, from drug and device manufacturers to health insurers, hospitals, and employers such as Abbott and Aetna, the Mayo Clinic, and Walgreens.

Grealy made the remarks at a news conference to support the Protecting Seniors' Access to Medicare Act of 2013. That bill would repeal IPAB, a panel of 15 political appointees who would—in the event healthcare costs per Medicare beneficiary reach a certain level—have broad powers to apply targeted or across-the-board cuts to the healthcare sector to level federal expenditures.

The IPAB is one of the most controversial provisions in the Patient Protection and Affordable Care Act.

Two federal lawmakers participated in a teleconference town hall Thursday sponsored by the council.

"Most people don't realize that this group will only be able for the most part to cut reimbursement rates to facilities and to providers," said Rep. Paul Gosar, (R-AZ), who said 80% of the seniors in his district are eligible for both Medicare and Medicaid, dual eligibles, because "we are a very poor district."

"And right now, we have an open rebellion, because the providers aren't getting paid and are restricting access (for dual eligibles) because of the mechanism of payment.

"You can't expect the private sector to absorb the losses the federal government is dictating."

Rep. Jim Matheson, (D-UT), added that the IPAB provision of the health reform law needs to be repealed because "it focuses on short-term cuts, and doesn't look at structure changes. I'm also concerned that it would not have any physician input."

In an interview, Grealy explained that some of the concern is that the IPAB would focus on cuts, rather than on restructuring the healthcare payment system to focus on outcomes, wellness and prevention. With draconian cuts, healthcare costs will be shifted to employers and employees in the private sector, the group believes.

According to the letter, "Requiring IPAB to achieve scoreable savings in a one-time period is not conducive to generating savings through long-term delivery system reforms."

The mechanism for cuts is a concern, the letter explained. "The Congressional Budget Office has in fact stated that the [IPAB] Board is likely to focus its recommendations on changes to payment rates or methodologies for services in the fee-for service sector by non-exempt providers. Again, this will have a severe, negative impact on Medicare beneficiaries."

The letter added that having an independent body, specifically made up of individuals who are not healthcare providers "sets a dangerous precedent for overriding the normal legislative process. Congress is a representative body that has a duty to legislate on issues of public policy.

"Abdicating this responsibility to an unelected and unaccountable board removes our elected officials from the decision-making process for a program that millions of our nation's seniors and disabled individuals rely upon, endangering the important dialogue that takes place between elected officials and their constituents."

Lastly, the letter points out that, "If the Board is never made operative, a provision in PPACA transfers IPAB's power to the Secretary of Health and Human Services, concentrating the enormous power in the hands of one individual."