IPAB: The next healthcare reform fight

Now that the U.S. Supreme Court has issued a ruling upholding the individual mandate portion of the Patient Protection and Affordable Care Act (PPACA), and both supporters and opponents of the law have returned to their respective corners, it’s time to look ahead at where the focus of the next round in the ongoing healthcare reform bout will be.

While the PPACA has survived mostly intact up to this point, polls show Americans remain deeply divided in their opinion of it. The Kaiser Family Foundation conducted a poll in the days immediately following the June 28 ruling, and found a statistical dead heat—41 percent for the law, 41 percent against, the rest unsure. An unscientific poll sent via email by the American College of Physician Executives to healthcare leaders found a more favorable attitude among these professionals, with more than 61 percent supporting the court’s decision.

The continued skepticism of the PPACA looks as though it could bring another set of challenges, and this point was made in a release from the American College of Radiology shortly after the ruling on the individual mandate. It noted there are a number of lawsuits still making their way through the judicial system, headlined by a challenge to the legality of the Independent Payment Advisory Board (IPAB).

IPAB was created by the PPACA as a cost-controlling mechanism for Medicare. It tasks a 15-member board to make recommendations to the Medicare program designed to curb costs should spending forecasts exceed certain target levels. For 2015 through 2019, the target growth rate is the average of overall inflation and medical inflation, and for 2020 and beyond, the target is the rate of increase in GDP per capita plus one percentage point. (For reference, the current projection for 2011-2021 of the annual increase in per capita spending for Medicare is 2.9 percent, according to the Centers for Medicare & Medicaid Services). These recommendations would then automatically be implemented unless Congress votes to override IPAB’s proposal and substitute it with a resolution of its own.

In August 2010, a lawsuit was filed by the Goldwater Institute, a conservative public policy advocacy organization, specifically targeting, among other things, IPAB. Diane Cohen, formally the senior attorney with Goldwater’s Scharf-Norton Center for Constitutional Litigation, now a general counsel for the Liberty Justice Center, told Health Imaging that IPAB constitutes an unconstitutional delegation of authority, granting congressional power to an unelected board. The lawsuit, Coons v. Geithner, had been stayed pending the Supreme Court’s ruling, but presumably, she said, it will be moving forward since the Supreme Court decision didn’t touch IPAB.

“What this board will be doing is rationing medical care,” said Cohen, who added this could include diagnostic testing and other radiologic services.

IPAB advocates, though, assert that the board will not be involved in rationing care and, in fact, are prohibited from doing so by the law. “A lot of the debate about IPAB has been very heated and focused on things that really aren’t necessarily issues with the IPAB,” said Stuart Guterman, vice president and executive director of the Commission on a High Performance Health System at The Commonwealth Fund, a private foundation aimed at improving the U.S. healthcare system. In addition to blocking rationing, Guterman said the law bars IPAB from making changes to the Medicare benefits package or increasing out-of-pocket costs.

Another concern voiced by Cohen is that IPAB’s powers will be unlimited and include changes not just to the Medicare program, but to private healthcare payments as well. Guterman explained that while the final version of the PPACA did expand the scope of the IPAB to look at private spending and make recommendations on how to control costs in this arena, the law didn’t give IPAB authority to implement its recommendations like it did with IPAB’s Medicare changes.

For radiologists, who may feel the specialty has been unfairly targeted by reimbursement cuts in the past, the concern might be that IPAB will lead to more of the same. Guterman said that should the IPAB survive its day in court, and all stakeholders commit to working together, across-the-board cuts could be avoided.

“I hope that if we get to the point where there is an IPAB…there would be a lot of interaction between Congress and the other stakeholders in the healthcare system and the members of IPAB to help them arrive at the right decisions to make the healthcare system really better, rather than just slashing and burning, because that’s not the way to solve the problem.”