A BETTER WAY FORWARD
Obamacare’s IPAB Will Ration Care
Obamacare created the Independent Payment Advisory Board (IPAB) – a 15-member panel charged with enforcing an upper limit on annual Medicare spending growth. The fifteen members would be appointed by the president and could make decisions without any further approval by Congress. Thus, the board will be unelected and unaccountable to the people.
Medicare already pays providers much less than private insurance for the services rendered to seniors. Obamacare will widen the gap still further, with deep payment rate reductions for nearly every type of medical service provider, and the IPAB will exacerbate the problem still more. To hit the law’s budget targets, the IPAB cannot reform Medicare. All it can do to hit the law’s budget targets is reduce even more what Medicare pays for services. In other words, IPAB will try to manipulate the market and set prices.
Commonsense and fundamental economics show that when the government uses price controls to hit budget targets, willing suppliers of those services leave the marketplace. Seniors will have a harder time finding doctors and hospitals to take care of them, and waiting lists will emerge for getting procedures and tests done.
In other words, the way the unelected, unaccountable IPAB will “control costs” is by rationing care.