The Independent Payment Advisory Board (IPAB) was established by the passage of the Patient Protection and Affordable Care Act (PPACA) of 2010 and is charged with reducing Medicare costs. Should the cost associated with operating Medicare exceed the rate of inflation, a trigger is reached and this board is engaged.
Impact to Grangers:
Health care jobs are essential to rural economies & IPAB could jeopardize job stability and diminish the quality of care provided in rural areas.
- Rural residents are more likely to be older, poorer, & not carry health insurance
- 10-15% of the rural workforce is directly employed by the health care industry
- Local hospitals are often the 2nd or 3rd largest employer in rural areas.
- Currently, there are 2,157 Health Professional Shortage Areas (HPSA) in rural areas, in contrast to 910 in urban areas
- Only 10% of physicians practice in rural areas.
- PPACA has already cut nearly $500 billion out of Medicare, & IPAB recommendations, to begin in 2015, could cut even more, creating a reluctance to begin new construction projects or hire new staff in rural areas.
- The American Medical Association and the American Hospital Association have warned that due to cuts in payment rates, providers will find it harder to offer quality care to Medicare recipients.
IPAB structure lacks democratic oversight. Powers given to IPAB far exceed any other federally established institution since the creation of the Federal Reserve Board and unlike any other branch of the U.S. Government, IPAB is unchecked by any other branch.
- Recommendations made by IPAB automatically become law unless Congress/President can provide own solutions that save the same amount or greater, or the Senate rejects the proposal with a 3/5 majority vote.
- Changes to Medicare by IPAB cannot be overruled by the President, and is not subject to judicial review.
- Members of IPAB are appointed by the President in rotating terms, not elected.
- A vote of a simple majority can send a proposal to Congress without the presence of a quorum or other minimum attendance rule.
IPAB Board nominations are set to begin this year, with confirmations occurring in 2012. Assuming triggers are met, IPAB’s first recommendations to Congress would be due January 15, 2014.