Republicans already failed one test of whether they are serious about passing a debt-reduction plan: Against political and mathematical reality, House Speaker John Boehner (R) on Tuesday insisted that any proposal from the president that included any tax increase would be a "non-starter." Now here's another test of Republicans' sobriety on debt: Whether they start talking about "Death Panels" or "health-care rationing" again.
Empowering a federal "Death Panel" was one of the better ideas in President Obama's health-care reform law, and now it's one of the better ideas in his deficit-reduction plan, which he detailed Wednesday.
The biggest driver of America's long-term budget problem is health-care spending on programs such as Medicare and Medicaid. So the president's health-care law included a goal of limiting growth in Medicare payments by tying them to the growth of the economy, plus 1 percent. The law also created a new body, the Independent Payment Advisory Board (IPAB), to oversee the process of cost containment. That's the "Death Panel," termed so by Sarah Palin, even though it wouldn't reduce the amount spent on each Medicare beneficiary, just slow the increase in the amount spent on each one.
On Wednesday, Obama proposed to make cost containment targets more aggressive, and to give IPAB more power to enforce those payment controls. The panel, for example, would get the authority to restructure how Medicare compensates doctors, paying for the relative value of procedures rather than just for services rendered. And if IPAB doesn't act, the president also wants automatic cost cuts written into law. GOP Rep. Paul Ryan's plan for Medicare has its own attractions to consider, but it doesn't contain any such explicit mechanisms to keep overall health-care costs down.
Even if it passed, the political threats to IPAB wouldn't end. Congress would have all sorts of power and incentive to overrule the panel's judgments. Past experience with automatic Medicare cost controls have failed, not because they were excessively weak, but because lawmakers have been. To this day, Congress passes a "doc fix" every year to stave off scheduled decreases in payments to health service providers. Will it do anything different after IPAB gets going?
Despite that risk, empowering IPAB is one of the few policies with the potential to reduce the growth in health-care costs directly. It's an obvious proposal in any debate on debt reduction. Just as Democrats can't expect to pass a real debt-reduction plan without considering other entitlement program reforms that Republicans favor, Republicans should resist demagoguing the president's IPAB proposal to death, as they tried to do the last time Congress considered it. Unless, of course, they are simply more interested in scoring political points.