Who wants to be a ‘death panelist’?

January 28, 2013

Welcome to Health Reform Watch, Sarah Kliff’s regular look at how the Affordable Care Act is changing the American health-care system -- and being changed by it. You can reach Sarah with questions, comments and suggestions here. Check back every Monday, Wednesday and Friday at 2 p.m. for the latest edition.

Jonathan Gruber was one of the Obama administration’s key advisers during the health-care reform debate. As the economist who conceived the ideas at the heart of the Massachusetts health-care law, he is arguably the intellectual godfather of the Affordable Care Act.

All of which would make him a natural fit for the Independent Payment Advisory Board, the new, 15-member panel that has the authority to reduce Medicare doctors’ reimbursements and pilot new ways to deliver high quality care for less. There’s just one tiny problem: Gruber has absolutely no interest in serving on the panel. “No way,” he says without pause. “Maybe if it was a part-time gig. But full time? I can’t see it.”

It's not just Gruber. Obama’s former health policy advisers worry that other top health economists, those in hot demand in academia and in the industry, won’t be interested in a federal job where the compensation is low, the political controversy high and the ultimate payoff unclear.

“It is supposed to be 15 members, with limited salaries who can’t do any outside work,” says Peter Orszag, the former director of the Office of Budget and Management under Obama who was a key proponent of IPAB. "It will be challenging to find top 15 health-care experts are who would want that job.”

“You’re joining an organization that has uncertain authority with the certainty of being deeply political and widely criticized,” says Bob Kocher, a former Obama health policy adviser. “It doesn’t make sense for current thought leaders in American health care to want this.”


(flickr)

The Independent Payment Advisory Board is one of the Affordable Care Act’s most aggressive attempts at bending the health cost curve downwards. Its goal is to ensure Medicare grows just one percentage point faster than the rest of the economy, much slower than historical trends.

To get there, the board has the power to change the amount of Medicare's doctor payments. Until now, that authority has been held only by legislators. Unless Congress can recommend and pass an equally big set of spending reductions, the IPAB cuts take effect automatically.

The board has drawn heavy criticism since it became part of the health-care law, with detractors drawing fire from the Obama administration and the health-care act's other supporters for referring to the board as a  “death panel” that would “ration” seniors' care. Even Democrats who staunchly support the Affordable Care Act have blasted the IPAB as an unjustified power grab.

“The Independent Payment Advisory Board brings unpredictably and uncertainty to providers,” says Rep. Allyson Y. Schwartz, a Democrat from Pennyslvania, who has supported multiple bills to repeal the board altogether.

To become a member of this already-maligned board, health policy experts have to undergo what one former Senate aide describes as a "super-double challenge": Meet the requirements set out in the law and then face confirmation hearings.

“It’s not only the challenge of finding people who will serve but also people who will serve and can get confirmed by the Senate,” says John McDonough, a Harvard professor who worked for the late Sen. Edward M. Kennedy (D-Mass.) during the health reform debate.

The health law specifies that the board be made up of “individuals with national recognition for their expertise in health finance and economics, actuarial science,” and other related medical fields.

Members will serve a six-year term and during that time are barred from “any other business, vocation or employment.” For their service, IPAB members will make an annual salary of $165,300, less than they would likely earn in the private sector or academia.

“This is going to be a tough one to fill,” says Bill Hoagland, senior vice president at the Bipartisan Policy Center, who has  done policy stints at health insurer Cigna and in the Senate. “If someone is extremely knowledgeable, they’re probably at some place where they’re making a lot more money. It will be a cut in pay.”

Hoagland and others still believe that the administration will find 15 people to fill the IPAB seats. The stringent requirements, however, will weed out some top talent who might otherwise be interested.

“They’ll find people,” says MIT’s Gruber. “There are many who are, no doubt, very qualified. But I think they’ll miss out on a number of the very best.”

Judy Feder, a public policy professor at Georgetown University, has testified before Congress that she would be “proud to serve” as a member of the IPAB. “I think its the primary mechanism we ought to be using to contain costs and increase efficiency,” she says. “I would like to see it done right and be part of accomplishing that.”

IPAB seats unfilled by blocked confirmations or a lack of interest, the Affordable Care Act includes a fallback measure. Health and Human Services Secretary Kathleen Sebelius has the authority to produce her own set of cost-cutting measures. Like those of the IPAB’s, they would also take effect automatically should Congress not pass an alternative.

There’s also the possibility that the IPAB won’t have much work to do this year: It produces its cost-cutting policy proposal only when Medicare is growing much faster than the rest of the economy. For the past three years, Medicare growth has slowed to the same rate.

The final decision won’t be made, however, until the end of April, when the Office of the Medicare Actuary releases its annual forecasts on Medicare cost growth. Kocher, a former Obama administration adviser, sees this as a sort of blessing in disguise because it buys the board a bit more time.

“There won’t be anything for it to do this year, based on previous forecasts,” says Kocher.  “That’s good, because it won’t have anybody working on it."

KLIFF NOTES: Today's top health policy reads from around the Web:

- Keep an eye on the lawsuits challenging the Affordable Care Act's mandated coverage of contraceptives. Now that  dozens of cases have received conflicting rulings, they are likely to reach the Supreme Court. Most recently, the U.S. District Court in the District of Columbia threw out a challenge from the Catholic diocese in Washington. Ethan Bronner in the New York Times.

- Do you like controversy and actuarial projections of Medicare spending? Of course you do! And you'll want to read this interview with retiring Medicare actuary Rick Foster, on how both sides take his projections out of context. Mary Agnes Carey in Kaiser Health News.

- In Maryland, its a David vs. Goliath insurance battle. Come 2014, UnitedHealthcare will find itself with a new competitor -- a nonprofit health plan backed by government dollars. Alex Wayne in Bloomberg.

Comments
Show Comments
Most Read Business
Next Story
Suzy Khimm · January 28, 2013