In last night’s debate (10/3/12) Two statements were made:
Mitt Romney stated: “In order to bring the cost of health care down, we don't need to have a board of 15 people telling us what kinds of treatments we should have.”
President Obama responded: “Let me just point out first of all this board that we’re talking about can’t make decisions about what treatments are given. That’s explicitly prohibited in the law.”
To the extent that the President used his usual half-truth approach to policy, it’s true, insurance companies NEVER prescribe treatment, they only determine what treatments they’ll pay for. Of course, Medicare is an Insurance Plan.
The provisions of the Affordable Care Act that discuss the Independent Medicare Advisory Board (renamed the Independent Payment Advisory Board) WILL include limitations on coverage not prescriptions of treatment.
The sections of the Affordable Care Act are 3403 and 10320. Both of these sections modify the Social Security Act section 1899A. The Board is the Independent Medicare Advisory Board which had its name changed to the Independent Payment Advisory Board by section 10320 of the ACA.
Summary:
Who: The law applies to all Medicare recipients but will not affect those on Medicare drastically until the year 2020. That’s seven years away which means that for those 55 and older, the impact of the Board will be less than for those 54 and younger. The President was correct when he stated in the debate: “So, if you’re 54 or 55 you might want to listen because this will affect you.”
What: The creation of an Independent Payment Advisory Board that will have broad powers to bring Medicare costs under control. Kindly terming this Board’s decisions as “recommendations” in all but a few instances these “recommendations” are actually mandates, the Board gets to make the rules.
This means that the Board’s advice must be implemented by the Secretary of Health and Human Services absent specific exceptions including Congressional action (such as modifying or repealing the provisions or by a 3/5 override) and in the case of certain administrative concerns such as mandates that don’t reduce costs or where copies of the mandates issued are not delivered to the President and Congress.
When: There are a couple of When dates. First, the Board will not be in the full throes of its powers until January 2020. The Board can begin its recommendation process as soon as January 15, 2014.
The Board’s powers are triggered by an annual determination by the Chief Actuary of the Centers for Medicare and Medicaid that costs will be too high (based on calculations included in the Act) for a specific year. The Board does not come into play until the Chief Actuary makes that determination.
Why: The purpose of the Board is to control Medicare costs and to come up with ways to do that.
How: The Board will create recommendations that function as rules regarding Medicare coverage that must be followed in the event triggering events occur and absent actions by Congress or their own mistakes that amount to exceptions. To refuse to implement the mandates of the Board will require a super-majority vote by Congress 3/5.
If you desire, the sections of the ACA are all cited below in the rest of this posting. Laziness in analysis by the media on this point is not acceptable because the Affordable Care Act is current law. The sections under consideration are 3403 and 10320 of the Affordable Care Act. (Anyone can read the Affordable Care Act at http://www.govtrack.us/congress/bills/111/hr3590/text)
Below are excerpts from Sections 3403 and Section 10320 of the Affordable Care Act. Both sections modify section 1899A of the Social Security Act which explains the strange numbering. The Affordable Care Act is used to change the Social Security Act.
Under Section 1899A (c)(3)(A)(iii) “Start-Up Period-The Board may not submit a proposal under clause (i) prior to January 15, 2014.”
Under section 3403 (a) (1) the Social Security Act is amended to provide for the establishment of an Independent Medicare Advisory Board (this is a new section 1899A (a) of the Social Security Act).
The provision is triggered in any year where the Chief Actuary of the Centers for Medicare and Medicaid determines that the anticipated growth rate (cost) of Medicare has gone up more than a targeted growth rate.
If such costs trigger this provision then the IMAB, the Board must create “a proposal containing recommendations to reduce the Medicare per capita growth rate to the extent required by this section; and (3) by requiring the Secretary to implement such proposals unless Congress enacts legislation pursuant to this section.”
If the provision is triggered then under Social Security Act new section 1899A (c) then the Board’s proposal must include “recommendations so that the proposal as a whole (after taking into account recommendations under clause (v)) will result in a net reduction in total Medicare spending in the implementation year that is at least equal to the applicable savings target established under paragraph (7)(B) for such implementation year.” Under the law in section 1899A (c) (2) (A) (ii) it says: “The proposal shall not include any recommendation to ration health care, raise revenues or Medicare beneficiary premiums…increase Medicare beneficiary cost-sharing…or otherwise restrict benefits or modify eligibility criteria.”
Section 1899A (c)(2)(A) (iii) states that “In the case of proposals submitted prior to December 31, 2018, the proposal shall not include any recommendation that would reduce payment rates for items and services furnished, prior to December 31, 2019…) However even before 2018, proposals, according to section 1899A (c)(2)(A)(iv) can include “as appropriate, the proposal shall include recommendations to reduce Medicare payments under parts C and D, such as reductions in direct subsidy payments to Medicare Advantage and prescription drug plans…”
Under Section 1899A (c)(2)(A)(v) Board proposals can include recommendations for money for themselves to “carry out the recommendations contained in the proposal”.
Section 1899A (c)(2)(B)(i) is called “Additional Considerations” and discusses that “the Board shall, to the extent feasible…(ii) include recommendations that (I)improve the health care delivery system, and health outcomes, including by promoting integrated care, care coordination, prevention and wellness, and quality and efficiency improvement.”
Section 10320 of the Affordable Care Act called “Expansion of the Scope of, And Additional Improvements to, the Independent Medicare Advisory Board.” Again, the section changes Section 1899A of the Social Security Act. There is a provision under this section 10320 (b) that changes the name of the Independent Medicare Advisory Board to the Independent Payment Advisory Board.
This section also lists other clarifications regarding punctuation as well as requirements that the Board’s proposals be submitted to the President and Congress.
Section 10320(a)(3)(B) (i) Provides for Limited Additional Exceptions when the Secretary of Health and Human Services does not have to implement changes. These exceptions are essentially if the proposals don’t reduce costs and in administrative instances where recommendations were not effectively provided to the President and Congress.
