JACR: Medicare advisory board will take center stage

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As questions mount over the role of the Independent Payment Advisory Board (IPAB) and political pressure to repeal it as an element of healthcare reform increases, the board will no longer fly under the public radar, according to an article published in the October issue of the Journal of the American College of Radiology.

Michael J. Pentecost, MD, of Magellan Health explained that the IPAB was included in the Patient Protection and Affordable Care Act as a way of curbing soaring medical costs. The board is intended to be an independent, impartial 15-member panel of physicians, nurses and other medical experts tasked with crafting cost-saving strategies for Medicare. Members would be nominated by the president, confirmed by the Senate and work full-time for the IPAB earning a $165,000 annual salary.

When the board is implemented in 2015, it will have numerous restrictions in the changes it proposes for Medicare, according to Pentecost. The IPAB may not raise costs to beneficiaries, restrict benefits, change eligibility requirements or ration care, a phrase that has “emptied many barrels of printer’s ink” wrote Pentecost. Payments for inpatient and outpatient hospital use can’t be reduced until 2020, leaving only physician fees, Medicare Advantage plans, Part D drug coverage and some other smaller programs as the targets of savings.

Pentecost listed a number of obstacles before the IPAB, the first being the poor track record of automatic budget cuts.

“As evidence, the sustainable growth rate mechanism has been law since 1997,” wrote Pentecost. “Yet since that time, the cuts to Medicare physician reimbursement mandated by the legislation have been implemented only once, in 2002.”

There will also be budgetary concerns as the board is expected to submit annual reports to Congress about costs, access, quality and utilization of medical care on a budget of $15 million.

But in Pentecost’s estimation, the biggest obstacle will be political. A 1 percent reduction in the Medicare budget would reduce spending by $5 billion. “Of course, that same $5 billion is some else’s revenue,” he says. The debate over the very existence of the IPAB – both Republican and Democratic members of Congress have introduced legislation to repeal it – will elevate the issue and draw the attention of physicians and the public, he noted.