The top two Republicans in Congress informed President Obama on Thursday that they will refuse to fulfill their duty under the Affordable Care Act to recommend members of a new board with the power to contain Medicare spending.
It’s a dramatic power-play driven by the explosive partisan politics of Obamacare and with potentially important implications for federal health care policy.
In a letter to President Obama, House Speaker John Boehner (R-OH) and Senate Minority Leader Mitch McConnell (R-KY) noted their original opposition to Obamacare, reiterated their intent to repeal it entirely, and declared that they would not make any appointments to the Independent Payment Advisory Board.
The IPAB is a 15-member panel whose members must be confirmed by the Senate. The President selects three members himself and is required by law to seek three recommendations each from the top Democrat and Republican in each chamber. With Thursday’s letter, Boehner and McConnell refused to make any recommendations.
The IPAB will be stood up in 2014 by Obamacare and tasked with making cuts to Medicare provider payments (it may not touch benefits) if costs exceed economic growth plus an additional percentage point in any given year. Congress can override it by passing equally large cuts with a simple majority or waiving the cuts entirely with a three-fifths majority.
“Because the law will give IPAB’s 15 unelected, unaccountable individuals the ability to deny seniors access to innovative care, we respectfully decline to recommend appointments,” Boehner and McConnell wrote in the letter.
But there is a catch: if IPAB fails to do its work for any reason, the Health and Human Services secretary must order the cuts herself. So in a way, Boehner and McConnell are surrendering some of their power in order to appear as though they’re thwarting Obamacare — when in reality they’re merely turning over more control to the executive branch.
“Under the ACA, if the IPAB fails to make a recommendation as required under the IPAB provision, the Secretary may make a recommendation in its place,” said Tim Jost, a professor of health law at Washington and Lee University. “So if no IPAB is created, it is not fatal.”
IPAB is, however, capable of functioning without all of its members confirmed. But the letter reflects a continuation of broader GOP obstruction of Obamacare implementation. Senate Republicans have suggested that they may filibuster any IPAB nominee, period.
This approach makes it easier for a future Republican president to neuter IPAB by executive fiat. In the short term, it puts the Obama administration more directly in the political line of fire for any cuts that it does approve.
The other political incentive for Republicans to oppose IPAB is that spending Medicare dollars more wisely makes it easier to sustain the single-payer structure of the program, and makes it harder to argue that it needs to be privatized, as the Paul Ryan budget does.
There is some irony as well in Boehner and McConnell refusing to play ball on IPAB — a key cost containment mechanism in Obamacare — while their party is complaining about potential cost increases under the law, and government spending more generally. Limiting Medicare spending and cutting the deficit, part of the rationale for IPAB, are routinely touted as central GOP goals.
“We believe Congress should repeal IPAB, just as we believe we ought to repeal the entire health care law,” Boehner and McConnell wrote. “In its place, we should work in a bipartisan manner to develop the long-term structural changes that are needed to strengthen and protect Medicare for today’s seniors, their children, and their grandchildren. We hope establishing this board never becomes a reality, which is why full repeal of the Affordable Care Act remains our goal.”
Read More →