Sebelius’ IPAB Defense Doesn’t Add Up
HHS Secretary Claims Government Healthcare Takeover Will Control Costs & Make IPAB’s Medicare Cuts “Irrelevant,” But Facts Tell Another Story
- Speaking Tuesday to the House Budget Committee, Obama Health and Human Services Secretary Kathleen Sebelius made the baffling claim that the Independent Payment Advisory Board (IPAB) created under the government healthcare takeover is just a “failsafe” and ultimately “irrelevant,” although just weeks ago she said it is “a key part” of the law.
- One of IPAB’s main powers is cutting physician reimbursement rates. Although recent reports argue that cuts in physician reimbursement rates can compromise access to care, Sebelius denied that IPAB’s Medicare cuts would have that impact because of “cost-efficiency” in the government healthcare takeover.
- But the evidence suggests the healthcare takeover is failing to control healthcare costs, and may even be making them worse. Even Medicare’s own actuary said that promises of controlling healthcare costs under the healthcare law are “more false than true.”
BACKGROUND:
Speaking Tuesday to the House Budget Committee, Obama Health and Human Services Secretary Kathleen Sebelius made the baffling claim that the Independent Payment Advisory Board created under the government healthcare takeover is just a “failsafe” and ultimately “irrelevant,” although just weeks ago she said it is a “key part” of the law. Even fellow Democrats are taking the administration to task over IPAB, so which one is it?:
SEBELIUS: IPAB IS “IRRELEVANT”:“Under questioning from Chairman Rep. Paul Ryan, R-Wis., Sebelius says ‘IPAB is irrelevant’ if Congress does its job.” (Phillip Klein, “Sebelius Downplays Importance of IPAB,” The Washington Examiner, 7/12/2011)
SEBELIUS SAYS IPAB JUST “A BACKSTOP, A FAILSAFE.” “Downplaying the role of the controversial Independent Patient Advisory Board (IPAB), Health and Human Services Secretary Kathleen Sebelius said today that the Affordable Care Act ‘leaves all final decisions’ on changing Medicare payment costs in the hands of Congress. ‘IPAB is a backstop, a failsafe, to make sure Medicare is solvent for years to come,’ Sebelius said at a hearing before the House Budget Committee this morning.” (Michael Warren, “Sebelius: IPAB Just A ‘Failsafe’ for Medicare Costs,” The Weekly Standard, 7/12/2011)
BUT TWO WEEKS AGO, SEBELIUS SAID IPAB WAS “A KEY PART” OF OBAMA’S MEDICARE PLAN: “A key part of the president’s plan, the Independent Payment Advisory Board, has recently been the subject of inaccurate claims.” (Kathleen Sebelius, “IPAB Will Protect Medicare,” Politico, 6/23/2011)
FORMER HOUSE DEMOCRAT LEADER DICK GEPHARDT: “UNELECTED AND UNACCOUNTABLE” IPAB WILL “PROPOSE CUTS TO MEDICARE,” WITH “DEVASTATING” CONSEQUENCES: “Under the current law, IPAB will be an unelected and unaccountable group whose sole charge is to reduce Medicare spending based on an arbitrary target growth rate. … Just as important, these cuts are likely to have devastating consequences for the seniors and disabled Americans who are Medicare’s beneficiaries because, while technically forbidden from rationing care, the Board will be able to set payment rates for some treatments so low that no doctor or hospital or other healthcare professional would provide them.” (Dick Gephardt, “Medicare Must Remain a Responsibility of Congress,” The Huffington Post, 6/21/2011)
One of IPAB’s main powers is cutting physician reimbursement rates. Although recent reports argue that cuts in physician reimbursement rates can compromise access to care, Sebelius denied that IPAB’s Medicare cuts would have that impact because of “cost-efficiency” in the government healthcare takeover. But the evidence suggests the healthcare takeover is failing to control healthcare costs, and may even be making them escalate:
SEBELIUS CLAIMS MEDICARE’S “OUTLOOK IS IMPROVED” DUE TO BETTER “COST-EFFICIENCY” UNDER HEALTHCARE LAW: “Medicare’s long-term outlook is improved as a result of the development of new systems of health care delivery that will improve health care outcomes and cost efficiency, and provide more effective tools to reduce waste and fraud. These measures will also help people with Medicare by slowing the growth of their monthly premiums, and by keeping their copayments and deductibles lower than they would have been under previous law.” (Kathleen Sebelius, “Medicare’s Future: An Examination of the Independent Payment Advisory Board,” Committee on the Budget, U.S. House of Representatives, 7/12/2011)
BUT “COSTS CONTINUE TO OUTPACE INFLATION” AND “CLIMB TO UNPRECEDENTED LEVELS” WITH 7 PERCENT INCREASE IN JUST ONE YEAR: “[T]otal health care costs continue to climb to unprecedented levels, reaching an anticipated $11,176 per active employee in 2011—up from $10,387 in 2010 (Figure 6, page 5)—a 7.6% increase in gross costs over this period.” (“16thAnnual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in Health Care,” Towers Watson, March 2011)
PREMIUM HIKES “A DIRECT RESULT” OF OBAMACARE: “Health insurers say they plan to raise premiums for some Americans as a direct result of the health overhaul in coming weeks, complicating Democrats’ efforts to trumpet their signature achievement before the midterm elections.” (Janet Adamy, “Health Insurers Pin Rate Hikes on Health Law,” The Wall Street Journal, 9/7/2010)
63 PERCENT OF EMPLOYERS PLAN PREMIUM INCREASES: “The economic slowdown and the likely increase in costs due to health care reform have led many employers to use various incentives to promote greater individual responsibility… Over the last year, employers put more emphasis on increasing premium contributions (Figure 23). Nearly two-thirds of companies have increased the share employees and their dependents pay in premium contributions (versus 2010).” (“16th Annual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in Health Care,” Towers Watson, March 2011)
INSURANCE PREMIUMS SEE STEEP RISE POST-OBAMACARE: “The average worker with a family plan was hit with 14% premium increase this year, pushing the bill to nearly $4,000 a year, according to a survey by the nonprofit Henry J. Kaiser Family Foundation and the Health Research and Educational Trust.
“That is the largest annual increase since the survey began in 1999 and a marked change from previous years, when employers generally split the rise in the cost of premiums with their employees.” (Noam N. Levey, “U.S. Employers Push Increase In Cost of Healthcare Onto Workers,” Los Angeles Times, 9/2/2010)
STUDY: PHYSICIAN REIMBURSEMENT RATE CUTS THREATEN ACCESS TO CARE: “Children with Medicaid are far more likely than those with private insurance to be turned away by medical specialists or be made to wait more than a month for an appointment, even for serious medical problems, a new study finds.
“Lower payments by Medicaid, delays in paying and red tape are largely to blame, researchers say. …
“Sixty-six percent of those who mentioned Medicaid-CHIP (Children’s Health Insurance Program) were denied appointments, compared with 11 percent who said they had private insurance, according to an article being published Thursday in The New England Journal of Medicine.
“In 89 clinics that accepted both kinds of patients, the waiting time for callers who said they had Medicaid was an average of 22 days longer.” (Denise Grady, “Children on Medicaid Shown to Wait Longer on Care,” The New York Times, 6/15/2011)
Even Medicare’s own actuary said that promises of controlling healthcare costs under the healthcare law are “more false than true.” How long will Democrats continue claiming their healthcare law reduces costs in contradiction of the facts?:
CMS ACTUARY RICHARD FOSTER: UNLIKELY GOVERNMENT HEALTHCARE TAKEOVER WILL HOST COSTS DOWN: “Two of the central promises of President Barack Obama’s health care overhaul law are unlikely to be fulfilled, Medicare’s independent economic expert told Congress on Wednesday.
“The landmark legislation probably won’t hold costs down, and it won’t let everybody keep their current health insurance if they like it, Chief Actuary Richard Foster told the House Budget Committee. His office is responsible for independent long-range cost estimates. …
“On the costs issue, ‘I would say false, more so than true,’ Foster responded.”(“Medicare Official Doubts Health Law Savings,” Associated Press, 1/26/2011)