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Progressive Counter Point: The IPAB Could Be A Good Thing

I shouldn’t do this. It’s madness to try to delve into the minds of conspiracy theorists and try to make sense of their ravings. But I can’t help myself; I’m drawn like a moth to the flame. It never ends well. I only wind up with a horde of trolls in the comments telling me that I’m a glib supercilious idiot and should stick to medicine or go die in a fire or something.

Sometimes it’s too hard to stay away. Maybe it was the personal affront I felt in the false imputation of ill motives onto progressives. Maybe it was the gross errors in fact, sitting there ripe for the plucking. I don’t know, but I just can’t resist a rebuttal to Dr Rich at Covert Rationing, who weaves a technocratic cost control body into a paranoid web of fantasy, concluding that:

Progressives are dedicated to “progressing” to a perfect society, and they know just how to achieve it. … Specifically, the Progressive program requires individuals to subsume their own individual interests to the overriding interests of the collective – and human nature just doesn’t function that way. Thus, the Progressive program inevitably relies on a cadre of elites – those who have dedicated themselves to furthering the Progressive program – to set things up the right way for the rest of us, while manipulating we in the teeming masses to let them. And the rest of us, once the correct programs and systems are in place, will at last understand that it was all for our own good.

I suppose this paragraph tells you everything you need to know … about Dr Rich. Any supposition that he was approaching the view of policy with a fair mind or that he is willing to attribute anything but the worst motivations to those on the other side of the aisle is completely shredded by this paragraph. As rhetoric goes, it’s up there with “Conservatives want old people to die in pain.” So we can scratch Dr Rich off the list of people who are willing to discuss health care policy with a neutral mindset. He’s engaged in a holy war of ideology.

But how does he rank in honesty? Oh, that’s not right of me. I shouldn’t mirror his approach of automatically assuming the worst motives to someone I disagree with. His errors of fact could be deliberately dishonest, but they could equally result from laziness, ignorance, misinformation, or untreated paranoid psychosis. It’s an open question! What is not really open for debate is that his theory is built upon several critical errors of fact.

Let me enumerate them. But first, a tiny bit of background.

You may have heard that healthcare costs are currently consuming something along the lines of 16% of the US Gross Domestic Product, and increasing at a rate well beyond inflation in general. Most people believe this is a really bad thing and that it is bankrupting the country. Most people believe that we need to do something to constrain the excess cost growth. The recently passed health care reform law — the PPACA — does make some modest steps towards this end. Many people believe that it does too little; I am one of them. One provision in the PPACA is the creation of the IPAB, the Independent Payment Advisory Board. I wrote about it a bit last month. If you’d like a summary, the Kaiser Family Foundation has a nice review (PDF). Basically, it will be composed of healthcare experts, doctors, nurses, patients and economists who, if health care costs continue to escalate, will create and institute reforms to control the spiraling costs.

This is where Dr Rich and I diverge in our opinion. I think it’s a pragmatic fix to the political paralysis exhibited by Congress over the last two decades in actually cutting costs. He thinks it’s a dictatorial body that progressives created to force humanity into a hive-like “collective.” His evidence for that, however, lies on faulty understanding of (or slimy dishonesty about) the actual, you know, law.

For example:

1) It has dictatorial powers.

…The IPAB is actually all-powerful.

Once the Chief Actuary of CMS determines that the projected per capita growth rate for Medicare exceeds a certain target growth rate (which it inevitably will), the IPAB is required to submit a so-called “proposal” which will cut healthcare costs sufficiently to bring the growth rate back in line; which is to say, the IPAB will determine what will be paid for and what will not. Then, the Secretary of HHS is required to implement that “proposal” in its entirety, unless Congress acts to block implementation. However, Congress is hamstrung.  The representatives of the people are forbidden from taking any action “that would repeal or otherwise change the recommendations of the Board,” unless it replaces those “recommendations” with its own legislation that would cut healthcare spending to the same target level.

For all practical purposes, then, the cost-cutting “recommendations” which the IPAB would “propose” for “consideration” will be implemented nearly automatically, with the full authority of the Federal government.

And, for all practical purposes, the IPAB will become a new agency of the executive branch, with near-dictatorial authority to cut healthcare spending where and when and for whom it sees fit.

Bold in original, and some rhetorical fluff omitted. So … wow. This does sound bad. Congress is powerless. It cannot change any of the IPAB recommendations? That’s awful. Why even have a Congress if it’s going to legislate its authority away? Except, well, it doesn’t. Dr Rich does acknowledge one countervailing fact — Congress can substitute the recommendations of the IPAB with its own! Right there, that does seem to contradict the assertion of DICTATORSHIP that Dr Rich claims. But there’s more! Not only can Congress choose to substitute its recommendations for controlling health care costs, Congress can WAIVE the requirement. That’d be Sec 3403 (d)(3)(D):

WAIVER.—This paragraph may be waived or suspended in the Senate only by the affirmative vote of three-fifths of the Members, duly chosen and sworn

So, to summarize, this infringement of LIBERTY by A DICTATORIAL UNELECTED BODY can have its recommendations swapped out by Congress or simply ignored. If you are a conspiracy theorist or a partisan hack, I guess that is dictatorship.

Now some may argue that Congress is too terribly screwed up to act in our interests and that they can never come together to overturn a bad recommendation by IPAB. (I’d also say that’s a great illustration of why we need IPAB and an argument for congressional reform.) The argument is that the IPAB becomes a de facto dictatorial board, because the bar is set too high to override its recommendations. We will see, I suppose. Congress manages to get 60 votes together every year to over-ride the SGR, so I don’t see why it’s impossible that if some controversial rules were handed down by IPAB that Congress wouldn’t waive the rules and scrap the recommendations. Is it hard? Yes, but it’s supposed to be. But it’s not impossible, and it’s not dictatorial.

Another bit of epic wrongness Dr Rich engages in is a theory that the IPAB is FOREVER!

It is an immutable entity.

Section 3403, the section that creates the IPAB and spells out its functions, contains some remarkable language that, DrRich suspects, has never been seen before in American legislative history. To wit:

“It shall not be in order in the Senate or the House of Representatives to consider any bill, resolution, amendment, or conference report that would repeal or otherwise change this subsection.”

So, the astounding truth, dear reader, is that the IPAB and all its designated dictatorial functions are in force for perpetuity. Our Congress has passed legislation that purports to bind all future Congresses from altering it in any way.

Now in this, I have to give Dr Rich full credit for good faith argument. He’s ignorant, but not being deceitful. I assume. The citation noted above is accurate, and it does sound bad. But in order to understand it you need to a) know a little bit about the arcana of the rules of order used in the Senate and b) know that Congress can NEVER  pass a law that a future Congress can’t undo. What the citation above means is that it is not “In Order” to modify or dissolve the IPAB. So, to do so, would require “Unanimous Consent” in the Senate, or a vote of 60 Senators to waive the rules for unanimous consent and vote on an “out of order” proposal to modify or repeal the IPAB.  (Full disclosure: I may have the exact parliamentary details not quite right, but the gist is there and the conclusion is accurate.) So, just as with the recommendations of the IPAB, its structure and continued existence are completely contingent on Congressional action, though with a deliberately-high 60-vote threshold.

Dr Rich also waxes hysterical about the intrusion of the IPAB into the private health care market. He rants a bit about the way the bill was passed, but the gist of his point is this:

IPAB, at least every two years, [must] “submit to Congress and the President recommendations to slow the growth in national health expenditures” for private (non-Federal) healthcare programs. Furthermore, it designates that these “recommendations” may be implemented by the Secretary of HHS or other Federal agencies “administratively” (that is, without the interference of Congress).

First of all, again, this strikes me as a GOOD thing. My health care premiums are going up 15% a year, and I’d really like to see that slow down. So if (and it’s a big if) IPAB has a good idea for a method in controlling private sector spending, then I’m very interested in hearing it. These are categorized “advisory” recommendations and are distinct from the “required” recommendations which pertain directly to the medicare program. And yes, The Secretary of HHS can implement such “advisory” recommendations administratively so long as they are within the existing statutory authority of the Secretary (Sec 3403, (e)(4)), and there are no explicit rules on how Congress may address such rules, which means that they can be over-ruled piecemeal or en bloc by a simple majority of both Houses of Congress, just as any other federal regulation can be: these advisory regulations would not require the 60-vote supermajority rule that the required recommendations would to overturn.


The PPACA does create new board with some unique and unprecedented powers. I can see why this would make some people concerned. Power can be mis-used, and oversight is necessary. I would say that there are at this time many open questions about the IPAB — remember that it does not yet have a single appointed member, let alone a track record. It may well be toothless or gridlocked by the time it comes into being. It may wind up as powerful as the Federal Reserve. It may achieve wonderful cost savings, or it may eviscerate the commercial underpinnings of American medicine. Lord alone knows. But it has more promise than ANY other federal cost-control proposal to date, and Congress seems to have retained enough power for itself that if the IPAB wind up doing something particularly bad or unpopular, they should not have trouble over-ruling it.

And if somebody tells you that the IPAB is the secret Democratic DEATH PANEL, they’re either pushing a particular agenda dishonestly or grievously misinformed.

*This blog post was originally published at Movin' Meat*

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