July 17, 2017
Medicare Trustees Report Does not Trigger ASA-Opposed IPAB; ASA to continue to push for repeal
Projected spending rates in the Medicare Trustees Report released on July 13 are still lower than Medicare's target level, so the Independent Payment Advisory Board (IPAB), an unelected and unaccountable board empowered to unilaterally cut Medicare Part B spending, will remain dormant. ASA has opposed IPAB and supports Congressional legislation to repeal this controversial provision created through the Affordable Care Act (ACA).
The ACA created IPAB as a mechanism to restrain Medicare spending. Under the IPAB provision, an annual Medicare spending threshold is set. If the spending threshold is exceeded by actual spending the IPAB is directed to identify Medicare spending cuts. If the Board does not put forth a proposal to cut spending, the Secretary of HHS must, by law, implement spending cuts.
Last year, the trustees warned that IPAB would be triggered in 2017, although the report now predicts that won’t occur until 2021. Under IPAB, major health policy decisions will rest in the hands of 15 unelected and largely unaccountable individuals. Fewer than half of IPAB members can be health care providers, and none will be permitted to be practicing physicians or be otherwise employed.
Additionally, IPAB cuts will disproportionately fall on physicians, as providers representing 37 percent of all Medicare payments --including hospitals and hospice care -- are exempt from IPAB cuts until 2020. As a result of the already unreasonably low Medicare payments for anesthesia services – “the 33% problem” - IPAB cuts could disproportionately impact physician anesthesiologists specifically. According to the Government Accountability Office (GAO), Medicare’s anesthesia payment rates are 33% of commercial providers’ payment rates. Physicians already face cuts over the next decade. IPAB will cut payments only, doing nothing to encourage greater access and quality care for our health care dollars.
ASA supports the Protecting Seniors' Access to Medicare Act, bipartisan legislation that would repeal the IPAB. Legislation has been introduced in both the House (H.R. 849) and Senate (S. 260).
Also according to the report, Medicare’s hospital trust fund is expected to run out of money in 2029, a year later than what was predicted in 2016 and a result of a slower growing of national health spending. Similar to last year’s prediction, the report also indicates that Social Security faces depletion in 2034.