Wall Street Journal highlights rationing implications of IPAB and its bureaucratic cousin


By Jennifer Popik, JD, Robert Powell Center for Medical Ethics

obamacarerationingreA recent article in the Wall Street Journal highlights how two related entities authorized by the Obama health care law – the Independent Payment Advisory Board and the Center for Medicare and Medicaid Innovation — both have the power to ration care. This April 23 op-ed by Lanhee J. Chen and James C. Capretta adds to the documentation provided by NRLC demonstrating that rationing of health care is built into the Affordable Care Act, also known as Obamacare.

The Independent Payment Advisory Board (IPAB) has remained one of the most controversial provisions of the Obama health care law since its passage. But Chen’s and Capretta’s op-ed focuses on a less widely known, but also dangerous provision of the Obama health care law–the Center for Medicare and Medicaid Innovation.

In the op-ed entitled, “The Other Stealthy ObamaCare Menace: The Center for Medicare and Medicaid Innovation exists to impose price controls and limit payments to providers” Chen and Capretta write

“The Affordable Care Act’s Independent Payment Advisory Board has been so heavily criticized for being an unaccountable body with the power to effectively ration Medicare services that many congressional Democrats no longer support it. IPAB’s bureaucratic cousin—the Center for Medicare and Medicaid Innovation—deserves the same treatment… Both institutions are in place to preserve rather than reform Medicare’s traditional, and broken, fee-for-service Medicare program. They both also embrace the ObamaCare technocratic mind-set.”


First, some background on the IPAB and how it fosters rationing. Most of the public focus (as well as the op-ed’s discussion of IPAB) has been on its authority of the Board to cut Medicare with very limited Congressional authority to override or alter those cuts. But National Right to Life has been emphasizing a still graver concern – one at the core of rationing in the Obama health care law.

Integral to the Obama Administration’s stated mission to drive down what Americans choose to spend for life-saving and health-preserving health care, the IPAB is charged with a key role in suppressing not just governmental health care spending (such as that in Medicare) but also private health care spending by limiting what treatment doctors are allowed to give their patients.

The health care law instructs the IPAB to make recommendations to limit what all Americans are legally allowed to spend for their health care to hold it below the rate of medical inflation. The health care law then empowers the federal Department of Health and Human Services to implement these recommendations by imposing so-called “quality” and “efficiency” measures on health care providers. (The documentation can be found in the endnotes at www.nrlc.org/uploads/communications/healthcarereport2014.pdf)

What happens to doctors who violate a “quality” standard by prescribing more lifesaving medical treatment than it permits? They will be prevented from contracting with any of the health insurance plans “qualified” under the Obama Health Care Law. Few doctors would be able to remain in practice if subjected to that penalty.

This means that a treatment a doctor and patient deem advisable to save that patient’s life or preserve or improve the patient’s health–but which exceeds the standard imposed by the government–will be denied even if the patient is willing and able to pay for it. Repeal of IPAB is critically important to prevent this rationing of life-saving medical treatment.


According to Chen and Capretta:

“The Center for Medicare and Medicaid Innovation has flown below the political radar. That’s due to its seemingly innocuous mission: promoting new and more efficient ‘payment systems’ and ‘models of care.’ But this agency is just as dangerous as IPAB. It is a bureaucracy within the massive Department of Health and Human Services superstructure and therefore run by the president’s political appointees. But unlike most of the federal bureaucracy, the agency never has to go back to Congress to get an appropriation. ObamaCare provided it with $10 billion, upfront, to cover its costs for a full 10 years.

“The statute also gives the Center wide-ranging authority to alter the Medicare and Medicaid programs without further congressional action. It is supposed to be testing new ways to pay providers of medical services. Changes that are found through pilot programs to reduce costs without harming quality, or found to be budget neutral while improving quality, can be implemented nationwide through regulatory fiat.

“The agency’s broad mandate reveals the mind-set of ObamaCare’s authors. The premise is that the federal government is best positioned to lead an effort in innovation in medical delivery, despite all evidence to the contrary.

“The agency’s authority is broad enough to allow across-the-board cuts in payments to hospitals and physicians, and lower reimbursements for pharmaceuticals and related products as well, all in the name of innovation.

“The Congressional Budget Office certainly expects this to happen. It says that legislation to repeal the agency’s $10 billion in funding would increase the deficit because its cost-cutting agenda is expected to produce more than $10 billion in savings from reimbursement cuts. It’s one more indicator that budgetary scorekeeping in health care is hopelessly biased in favor of irrational governmental controls.”

Through both the IPAB and the Center for Medicare and Medicaid Innovation, Obamacare authorizes federal bureaucrats to impose limits on what life-saving medical treatments Americans are allowed to get. It may not call this “rationing.” But that doesn’t mean that it isn’t.

For a comprehensive overview of the rationing effect of the Affordable Care Act, see “The Affordable Care Act and Health Care Access in the United States.”