Today, the Administration weighed in with an important proposal that might provide the best shot at making sure health care reform legislation has a lasting legacy of reducing costs. (See a summary of the proposal here).
As CBO director Orszag explains, they are looking to create an independent council which will be able to set payment rates and alter payment systems in Medicare, and these recommendations will be done regularly and will take effect unless the President and then Congress explicitly decide to ignore them.
In this proposal, the body of experts would be called the Independent Medicare Advisory Council or IMAC. The idea for such a council is not new to the reform debate, and is more often referred to as a “Super MedPAC” named after the Medicare Payments and Advisory Commission. This commission currently makes great recommendations to Congress, and many of their reports are pretty digestible. The problem is their suggestions are just advisory, and Congress routinely ignores them.
The President’s budget does propose hundreds of billions in Medicare cuts taken from MedPAC’s reccomendations in order to make the health care reserve fund budget neutral, and it is likely that many of these cuts will be used as offsetts in the final health care bill. What their IMAC proposal would do, is insure that such cuts will become routine and not dependent on once-every-15-years legislation to reform health care.
Furthermore, it makes sense to give some of the year-to-year operation of Medicare to such a body and out of Congress’s hands. Since individual members of Congress aren’t all experts on the particulars of health care finance and up-to-date on specific procedures and devices, leaving these decisions to them sometimes allows for parochial decision-making which doesn’t reflect fiscal responsibility or quality health care.
The Concord Coalition believes that having this continual process added to reform legislation is incredibly important. Whether that is done through the Administration’s IMAC, or a Super MedPAC similar to what can be found in legislation proposed by Rep Jim Cooper (D-TN) in the House and Senator Jay Rockefeller (D-WV) in the Senate, or some other like mechanism, is not as important. The key is that health care reform will need to be a continual process because the problem of rising costs is too large and always evolving for one piece of legislation to solve.