Sebelius vs. Orszag on the IPAB's Power

Comedy gold or a pathetic partisan ploy can characterize Kathleen Sebelius’s testimony when she attempts to minimize the immense authority granted to the Independent Medicare Payment Advisory Board (IPAB), when so many of us know the raw real deal.  On July 13, the House Subcomittee on Health and Energy held hearings on the controversial IPAB, in which Sebelius attempted to minimize and circumvent the truth (pdf and a must read) with regards to the IPAB.

Congressman Michael Burgess (R-TX and yes, he is also Dr. Burgess) questioned Secretary Sebelius on several key factors, including the unelected 15-person panel, their potential recess appointments to avoid Senate confirmation, and the ultimate effects of this panel in reshaping the health care system.  Burgess does not let Sebelius off the hook, but pushes her on the IPAB’s power and lack of judicial oversight. The entire exchange is worth watching:

Sebelius touts that the IPAB is only a “fail-safe” and only makes recommendations if Congress does not act:

But Sebelius was defiant against claims that IPAB risks usurping the power of Congress to make changes to Medicare. “All final decisions remain in the hands of Congress,” Sebelius said in her prepared statement. “If Medicare costs are rising at an unsustainable rate, it’s Congress’s choice whether to accept those recommendations, or come up with recommendations of its own to put Medicare spending on a stable, sustainable path.” She reiterated her argument from yesterday’s Budget hearing that IPAB serves as a “backstop to ensure Medicare remains solvent for years to come.”

However, former OMB Director Peter Orszag has a quite different analysis regarding the IPAB with this interview, highlighted by Naked Emperor News for Breitbart TV:Orszag clearly emphasizes “[the IPAB] has an enormous amount of potential power.”  Orszag goes on to explain, “The proposals take effect automatically unless Congress, not only specifically votes them down, but Congress specifically votes them down (with 67 votes) and the President signs that bill. So, the default is now switched in a very important way.”

Orszag has repeated this in other forums stating that the IPAB was the most important part of ObamaCare (all emphasis mine):

The Medicare Commission, or Independent Payment Advisory Board, would have the power to override Congress if it rejected cuts to the entitlements programme for seniors, said Mr Orszag, a key architect of the reforms signed into law this week.

“This could well turn out to be as consequential for health policy as Federal Reserve policy was for monetary policy,” he said in an FT View from DC video interview. “The commission will put its proposals forward and if Congress does not act on them, or if it votes them down and the president then vetoes that bill, they will automatically take effect. Huge change.”

So, who is right?  Sebelius or Orszag?  My money is on Orszag. The fact is that no matter what Congress does, the IPAB will always have a way to enforce its “recommendations” and override Congress. Sebelius is intentionally misrepresenting the IPAB as being similar to the MedPAC board, which does indeed only give recommendations to Congress. Why would they need to have a duplicative board? Truth is, they are not the same and Sebelius knows it.

With the Democrats zeal to ram through ObamaCare, they created a monster and then stripped themselves of any oversight of said monster as clearly explained by Orszag.  If only the Democrats had read the original ObamaCare bill, didn’t scoff and snear at Republicans’ warnings, and didn’t believe their own rhetoric, it wouldn’t be so imperative to repeal the IPAB.  But wait, can they?