Contemplating the 2012 election that can already be seen
looming on the distant horizon, the President’s advisors were no
doubt hoping that the “death panel” debate was… well… dead. But
Obama himself inadvertently resurrected it when, in response to
Republican budget proposals, he claimed that Medicare costs will be
kept under control by the Independent Payment Advisory Board
(IPAB). Obamacare opponents have been screaming about this
committee since it was first added to the “reform” bill. And, since
that time, anyone with the temerity to call it by its proper name
— death panel — has been vilified by the Democrats and the “news”
media. Nonetheless, that’s precisely what IPAB will be. Its sole
purpose is to cut funding for some health care services seniors now
take for granted. And those cuts will kill people.
IPAB was created pursuant to section 3403 of the
ironically named Patient Protection and Affordable Care Act
(PPACA), and its ostensible purpose is to “control costs.” In
reality, it will do nothing at all about costs. Instead, the
board’s fifteen “experts” will impose old-fashioned price controls.
Before Obamacare was signed into law in March of 2010, only
Congress had the power to make changes to Medicare’s reimbursement
rates. But PPACA, for all intents and purposes, transfers that
power to this tiny cadre of presidential appointees who will have
no accountability to the voters. In theory, IPAB can only
propose changes to Medicare’s payment rates. In practice,
however, the board’s proposals will take effect automatically
unless Congress passes contrary legislation and the President signs
it into law.
This concentrates a huge amount of power in the hands of
these fifteen people. As Obama’s former Director of the Office of
Management and Budget, Peter Orszag,
phrased it last year in a discussion at the
Economic Club of Washington: “This institution could prove to be
far more important to the future of our fiscal health than, for
example, the Congressional Budget Office. It has an enormous amount
of potential power.” This comment suggests that the Obama
administration always intended to maintain the country’s “fiscal
health” by stinting on Granny’s physical health. Hyperbole?
Consider Orszag’s description of the automatic implementation
feature of IPAB’s proposals: “So the default is now switched in a
very important way on the biggest driver of our long-term costs,
which is the Medicare program.”
Considering that IPAB’s mission involves Medicare cuts,
one can’t help but wonder if Obama’s political team was comfortable
with how much emphasis he put on it during last week’s budget
discussions. He made it abundantly
clear that, if spending rises faster than expected, he “will
give the independent commission the authority to make additional
savings by further improving Medicare.” But the relevant provision
of PPACA was obviously written to keep IPAB below the radar until
the President, and the Democrat majority in the Senate, have
survived the 2012 election cycle. The law doesn’t require the board
to produce its first recommendations until 2014. Thus, a safely
reelected Obama would have time to submit even controversial
nominations for IPAB membership, which a friendly Senate would
happily confirm.
Such political considerations notwithstanding, Obama
probably wasn’t worried. He no doubt sees PPACA’s death panels as a
feature rather than a bug. This sentiment is shared of most
advocates of socialized medicine. In a piece titled, “Why
‘death panels’ are a necessary evil,” columnist Jay Bookman
captured this progressive consensus when he
wrote that “Death panels exist, they will exist in any
conceivable system of health-care delivery, and we all know they
are necessary but prefer to ignore it.” For these people, it’s
either us or Granny: “Somebody has to say no to the terminal
patient who refuses to acknowledge that he or she is terminal and
demands hopeless if expensive treatment.… Somebody has to have the
power to rule that Procedure A or Drug A is more cost-effective
than Procedure B or Drug B.… Even Heaven has a
gatekeeper.”
With this last snide flourish about St. Peter, Bookman
inadvertently stumbles upon the thing that makes many people, of
all political persuasions, uneasy about the amount of power that
has been given to IPAB. The members of this board will be mere
mortals, installed by a president whose choice of appointees thus
far has shown little divine inspiration. Thus, even some Democrats
have grave concerns. Rep. Allyson Y. Schwartz (D-PA), for example,
is among the co-sponsors of a bill that would repeal IPAB. In a
statement released last week she said, “Congress must assume
responsibility for legislating sound health care policy for
Medicare beneficiaries.… Abdicating this responsibility, whether to
insurance companies or an unelected commission, would undermine our
ability to represent the needs of the seniors.”
The tragic irony here is that costs can be controlled
without pulling the plug on Granny. There are market-based
alternatives to government rationing. Despite what we have been
repeatedly told by progressive policy wonks, health care is not a
unique universe in which economic forces fail to operate properly.
It is, in reality, possible to utilize the market to control costs.
One plan for doing so has been put forward by Budget Committee
Chairman Paul Ryan, who would introduce competition among insurers,
realign tax incentives and remove some of the regulatory morass
that reduces the efficiency of health care providers. This
market-based approach was used with success in the Medicare Part-D
program, which was actually starting to
drive down drug costs until the Democrats began meddling with
it after retaking Congress in 2006.
Another alternative is the “Purple Health Plan,” proposed
by Boston University economist Laurence Kotlikoff. As David Hogberg
reports at Investor’s Business Daily, this plan seeks
to “achieve the liberal goal of universal care via a
market-oriented voucher.” A lot of prominent economists have
endorsed it, including Nobel laureates George Akerlof and Thomas
Schelling. Kotlikoff’s basic idea is to “trade in” outmoded ideas,
like the employer-based tax exclusion and the major federal health
programs, and use the money thus saved to provide Americans with
vouchers that we would use to buy our own health insurance plans.
There are features to this plan that will incur the displeasure of
free market purists, including its own panel of physicians who
would make arbitrary decisions, but the point is that it is another
choice.
Unfortunately, choice is not a popular concept with the
President and his health care apparatchiks at the Centers for
Medicare and Medicaid Services (CMS). For them, “cost control”
means government-imposed rationing of care to the elderly. Obama’s
CMS administrator and lead health czar has often praised IPAB’s
deadly British prototype, the National Institute for Health &
Clinical Excellence (NICE) and has famously averred that “The
decision is not whether or not we will ration care; the
decision is whether we will ration with our eyes open.” The problem
is that Obamacare’s death panel, as Sarah Palin correctly
dubbed IPAB in the Wall Street Journal, will end up
closing a lot of aging eyes — permanently.
