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Slashing Medicare Costs, and Benefits

Last update on: Feb 02 2017

A little-noticed provision of the 2010 health care reform (Affordable Care Act) is the Independent Payment Advisory Board (IPAB). This will be a 15-member panel of experts appointed by the President without input or oversight from Congress. The IPAB would designate the appropriate levels of care and treatment. It’s expected that Medicare would follow the IPAB’s guidelines in deciding which treatments to pay for.

The benign explanation is that the panel would make medicine both less expensive and more effective by eliminating unnecessary tests and treatment and focusing medical providers on treatments known to work. The less benign explanation is that the IPAB would ration care. For example, it might decide that Medicare shouldn’t pay for hip replacements for people over a certain age. Or it could mirror recent FDA rulings by deciding that while a particular drug or treatment was effective, it isn’t effective enough to justify the cost.

That’s why there’s a backlash against this provision that was snuck into the law.

“One of the key provisions in President Barack Obama’s health care reform law — his preferred method for getting Medicare costs under control — is facing a groundswell of opposition from unexpected corners.

“Several House Democrats have signed on to support a bill to repeal the Independent Payment Advisory Board, a panel created by the law that is supposed to help control rising costs in Medicare. The National Committee to Preserve Social Security and Medicare, a prominent supporter of the law, is now actively lobbying for its repeal, too.

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