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Will the IPAB ration?

The new conservative line on health reform’s Independent Payment Advisory Board for Medicare is that it’s “a rationing panel,” even though the law explicitly states that it can’t save money by restricting or reducing benefits. In a House Budget Committee hearing, Paul Ryan claimed that:

Reducing payments to providers would undercut seniors’ access to doctors and hospitals and thereby ration their care. His argument is that Medicare already underpays providers, forcing them to either shift costs to individuals with private insurance or close off their Medicare business altogether, and any additional cuts will only exacerbate this problem.

Secretary of Health and Human Services, Kathleen Sebelius, who was testifying before the committee quickly shut down that argument, by reminding Ryan of all the other reforms that will go along with the IPAB:

RYAN: Obviously if we underpay them it will save more money. The question is, if we underpay them, will they keep delivering the benefit? … Don’t you agree that if we underpay them they will just stop seeing beneficiaries?

SEBELIUS: Mr. Chairman, I think the assumption is that nothing changes in care…that we keep paying at the same not only rates, but keep saying for the same kinds of services. So if you assume that care delivery doesn’t change at all, that we keep paying for good care, the same that we pay for bad care, if we don’t have any changes in underlining care, if we dont’ coordinate care, if we don’t have more home based patient based care….That trend line is probably accurate.

I would suggest that what the Affordable Care Act does and what we have begun to do pretty successfully with the innovation center and the very enthusiastic support of a lot of health care providers across the country is look at where the best practices are…groups that have actually delivered very high quality care well below the trend line and capture that and then reach out to others to try to accelerate that change and use the enormous levers of the Medicare payment system to do just that to drive best practices.

Meanwhile, the Urban Institute’s Judith Feder also has a good defense of the IPAB here.

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