Even Democrats Don't Support Obama's Plan to Bring Down Medicare Spending


Here's why President Obama's plan to cut $480 billion in Medicare spending over the next dozen years won't work: Even members of his own party don't support it. From The Hill:

Rep. Allyson Schwartz (D-Pa.) on Friday urged lawmakers to repeal a controversial provision of the healthcare reform law that President Obama says is central to his deficit-cutting efforts.

Obama in his deficit speech Wednesday urged lawmakers to strengthen the law's Independent Payment Advisory Board (IPAB), which sets Medicare cost targets and recommends payment cuts if they're exceeded. In a "Dear Colleague" letter just two days later, Schwartz instead advocates for getting rid of the board altogether.

"While I embrace the goal of reducing costs," she wrote, "I cannot condone the implementation of a flawed policy that will risk beneficiary access to care.

This is what I was talking about yesterday when I wrote that a big part of the problem with counting on IPAB to produce savings is that it's politically unstable. Health industry groups are determined to kill it. And legislators in both parties are highly sympathetic to the industry message (as Suzy Khimm notes at Mother Jones, the panel "was never popular among House Dems") in large part because IPAB substantially reduces Congressional authority over Medicare. Industry groups don't like seeing their payments reduced (likely a big part of how IPAB would achieve its savings), and members of Congress don't like handing off their authority to an executive branch commission.

We've already seen Congress repeatedly undermine the savings that were supposed to be generated by the Sustainable Growth Rate—the formula designed to keep doctors' Medicare reimbursements under control. Every year, the formula calls for cuts, and every year Congress, under pressure from doctors' groups and seniors' organizations, votes to override those cuts. With IPAB, it seems distinctly possible that Congress will vote to either get rid of the board or severely limit its power before it really even gets started.