The House Ways and Means Committee will soon mark up bipartisan legislation to repeal the Independent Payment Advisory Board (IPAB), a non-elected body established as part of the Affordable Care Act (ACA). The original intent for the creation of the IPAB was for the executive branch to form an appointed independent body to decrease the growth rate of Medicare expenditures and do so without the input or approval of Congress. Unfortunately, the IPAB takes congressional oversight and decision-making out of the equation and allows blunt actions to the Medicare program go unchecked. The National Association of Manufacturers (NAM) agrees with hundreds of other groups: the IPAB must go.
Cutting Medicare reimbursements is not an effective way to achieve savings, and it does nothing to address the system’s long-term structural problems. The IPAB is a wrong-headed approach and does nothing to encourage commercial innovations in health care delivery that are focused on value and accountability. Instead, it reduces the vision of the Medicare program to year-by-year increments rather than looking at both the short-term funding issues and the long-term health of the program and the services it provides to American seniors. The reality is, the more costs are cut in Medicare, the more health care providers look to charge private plans higher rates to meet their costs. These actions led by the government contribute to manufacturers’ and other employers’ rising health care costs. This is exactly the wrong approach to firming up Medicare’s financial footing.
Further, cuts to Medicare inhibit access to newer therapies, stifle private-sector innovation and discourage research and development. Perhaps most disconcerting is that decisions are made by an unelected body with unprecedented power and little oversight from Congress. The IPAB represents a significant obstacle to reducing health care costs and increasing access to affordable health coverage. Instead, we should be looking for a way to solve these major issues that the unelected and unaccountable forces of the IPAB neglect.
These are just some of the reasons the NAM supported the repeal of the IPAB in the past and will continue to do so into the future. In the absence of a full repeal of the ACA, manufacturers will take health reform one bill at a time.