IPAB Should Be Repealed

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Posted by Virginia Birkofer on Thursday, July 6th, 2017, 8:00 AM PERMALINK

Congress continues to make progress on phase one of healthcare reform through the Senate’s “Better Care Reconciliation Act,” legislation that repeals key parts of Obamacare. Moving forward, there are many other reforms that Congress should make to the nation’s healthcare system that promote access to care, fiscal responsibility, patient choice, and state flexibility. One obvious reform should be the repeal of the Independent Advisory Payment Board (IPAB).

IPAB was created seven years ago when Obamacare was signed into law. The basic role of IPAB is to institute price controls and rationing within the Medicare system. In practice, this leaves the U.S. healthcare system with the same price controls attempted (and failed) in socialized medicine systems seen throughout the world.  

IPAB’s scope and role also undermines the constitutionally granted authority that Congress has over the power of the purse. IPAB bureaucrats are free to institute price controls they see fit without approval from Congress. As a result, this board has immense power over health outcomes and the livelihood of patients and doctors.

Repealing IPAB is not controversial – there is broad consensus from a range of stakeholders. Allowing the board to operate will result in indiscriminate cuts to Medicare that undermine healthcare choice and access of 55 million Americans.

Congress has several legislative options to repealing IPAB. Lawmakers have a brief window to repeal IPAB by passing the “Protecting Medicare from Executive Action Act of 2017” (S.J. Res. 17/H.J. Res. 51). This option allows Congress to discontinue IPAB through an expedited legislative process, but must be used before mid-August.

If they choose not to go down this path, Congress can pass H.R. 849, legislation introduced by Congressman Phil Roe (R-TN). This bipartisan legislation has more than 200 co-sponsors and could be considered as a stand-alone proposal or as part of broader healthcare reforms.

While repeal of IPAB is scored as costing $7.6 billion over the next decade, this should not be an impediment to repealing the board, as current law assumes some price controls will already go into effect. Given other stages of healthcare reform will produce significant savings that reduce the deficit, repealing IPAB should not be constrained by the need to find corresponding offsets.

This year, Congress and the administration have an opportunity to implement bold healthcare reform. Repealing IPAB and the price controls that the board will implement should be part of this legislative agenda. 

Photo Credit: Photo Credits: John Barry Miller

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