Provisions for a Medicare Independent Payment Advisory Board (IPAB) in the recently passed Senate health reform bill, H.R. 3590 has caused a strong outcry of opposition from many physician groups, who joined with other organizations in signing a letter to Senate Majority Leader Harry Reid (D-Nev.) and Speaker of the House of Representatives Nancy Pelosi (D-Cal.) expressing their disapproval.

The letter notes “the purpose of the Independent Payment Advisory Board is to reduce the rate of growth in Medicare spending indefinitely” but that “in most years Medicare’s per capita growth has been below or equal to growth in the private sector.” The creation of an IPAB would cause reductions in payments that would be “in addition to the $400-500 billion savings in provider payments already included” in health care reform measures. Such cuts would jeopardize “access for Medicare beneficiaries” as well as the infrastructure of the “entire health care system,” according to the letter.

Signatories to the letter include the California Medical Association (CMA), the American Hospital Association (AHA), the American Society of Anesthesiologists (ASA) and the American Urological Association (AUA).

The American Medical Association and the American College of Surgeons have both voiced their opposition to IPAB, but neither organization was included in the list of signatories.  The American College of Physicians has also not signed the letter, although it has expressed reservations about IPAB. “We do not support the current Senate proposal to create and Independent Payment Advisory Board unless it is modified to include safeguards to mandate sufficient public participation, to allow it to make recommendations for all providers and suppliers at the onset; and to give Congress the authority, by a simple majority vote, to determine if the recommendations can go into effect,” said the ACP in their own letter to Congressional leaders.

CMA, AHA, ASA, AUA and the other signers of the January 11 letter to Reid and Pelosi content that the IPAB proposal “usurps Congressional authority over the Medicare program.”  Additionally, in assuming authority over Medicare, the Presidentially appointed board “would be required to make recommendations to reduce per capital Medicare spending regardless of whether it was growing faster than general health care inflation.”

The creation of an IPAB would replace “elected officials with political appointments from the President” and “does not remove ‘politics’ from the equation.”  IPAB would not be “accountable to anyone but the President,” according to the seventy-five organizations.

IPAB would create barriers to “the ability of Medicare beneficiaries, advocates and providers to work with Congress to improve the program” and would make coverage of new procedures and technologies more difficult to obtain. The board would not have the ability to change eligibility or benefits, leading some analysts to suggest that most of its recommendations would focus on Medicare Advantage plans and payments to medical providers.

The idea of IPAB was introduced in legislation in May 2009 by Senator Jay Rockefeller (D-WV) and was predicated upon expanding the powers of the existing Medicare Payment Advisory Commission (MPAC) into a quasi-governmental body, similar to the Federal Reserve Board.  “Congress has proven itself to be inefficient and inconsistent in making decisions about provider reimbursement. If we want serious improvements in our healthcare delivery system, then we need to reform MedPAC’s current authority to include fully establishing and implementing Medicare reimbursement rules.”  The seven point plan for an IPAB included elimination of special carve outs such as for hospitals and hospices.

MPAC is an independent Congressional agency established in 1997 as a result of the Balanced Budget Act. Its mission is to advise the U.S. Congress on issues affecting the Medicare program including payments to private health plans and providers participating in Medicare. It was also commissioned to analyze access to care, quality of care and other issues affecting Medicare.

The MPAC has seventeen members who are appointed to three-year terms by the Comptroller General. The current chairman is Glenn M. Hackbarth, an attorney with healthcare executive and policy experience. A staff of analysts and executive director further supports MPAC.

The full letter and list of signers can be seen here: http://www.ncpssm.org/news/archive/letter_independent_payment/