I Asked for and received this information from the office of Rep. Louie Gohmert R-Tx 1st District. He was a judge on the 12th Circuit appeals court. Showing that “The Independent payment Advisory Board “ would have the power to deny certain medical procedures to certain people.
Sam HodgesInternRep. Louie Gohmert (TX-01)
- REVIEW & OUTLOOK
- March 9, 2012
Independent Payment Advisory Revolt
House Democrats turn on ObamaCare’s rationing committee.
Public opposition to the Affordable Care Act has grown in surprising and unpredictable ways since the entitlement passed two years ago, but few would have predicted then that so many Democrats would repudiate so many of President Obama’s core promises. Yet that is happening now, as Congress targets the 15-member central committee that is supposed to control health costs.
The vehicle is a bill from Tennessee Republican Phil Roe that would repeal the Independent Payment Advisory Board, or IPAB, the new ObamaCare bureaucracy with vast powers to control health care and health markets starting next year. A straight majority of the House has joined Mr. Roe as co-sponsors—some 234 Members, including 20 Democrats. The bill cleared the Energy and Commerce Committee this week with a vote from its ranking health Democrat and the Ways and Means Committee Thursday, on a voice vote with no recorded objections.
This turn is remarkable because the IPAB really does embody ObamaCare’s innermost values and beliefs—to wit, that health decisions are too important to leave to the people receiving the care (patients), the people providing the care (doctors and hospitals), the people paying for the care (taxpayers), or even the people who got the government involved in the first place (politicians).
Instead, supposedly independent experts will run a battery of small experiments, figure out which ones “work” and then impose them through Medicare’s price controls on all U.S. medicine. When health spending in a given year exceeds a budget benchmark, as it always does and will, the 15 White House-appointed wise men will work their miracles.
Former White House budget director Peter Orszag designed the IPAB to insulate it from the political system, akin to the Federal Reserve. This displeased liberals in Congress because for them entitlements aren’t merely about social welfare but advancing their political agenda. If the IPAB succeeds in quarantining Medicare from politics, Washington would lose its powers to direct spending to political clients.
The irony is that the White House is expanding the government-run health care that it says the government can’t be trusted to run by itself, even as its unaccountable, unelected board undermines democratic consent. The IPAB was relieved of the normal checks and balances of notice-and-comment rulemaking, and its edicts aren’t subject to administrative or even judicial review. Consumers have far more rights of legal recourse under the private health plans that Mr. Obama deplores.
The double and more dangerous irony is that such technocratic dreams have been consistently frustrated, despite three or four decades of trying. Now that Mr. Obama has rewarded the planners for their failures with new authority, the question is what they’ll do with it when they fail this time, too.
In January, the Congressional Budget Office surveyed the results of every major Medicare demonstration project over the last 20 years. Among 34 programs to reduce hospital admissions, all 34 “had little or no effect on hospital admissions” and “spending was either unchanged or increased relative to the spending that would have occurred in the absence of the program.” Out of four so-called value-based payment programs, only one saved money, and then not that much.
Everyone hopes that this time is different and that the Affordable Care Act’s new attempts find more efficient ways of delivering care. But even considering its track record, there’s reason to doubt they will make any difference. Last year the Administration disclosed that Medicare’s payment system will crash if it stops processing bills for more than a week or two, because it doesn’t have enough computing power to handle a major backlog. One of the only things this entitlement does well is push money out the door.
The larger problem is that even successful pilot programs are hard to replicate. “This usually does not work,” as David Petraeus writes in his military counterinsurgency manual, which as it happens is the best deconstruction of “large-scale, mass programs” that we’ve seen. General Petraeus notes that “small-scale programs succeed because of local conditions” and he recommends keeping them that way, so that they’re “cheap, sustainable, low-key, and (importantly) recoverable if they fail.” This advice applies as much in health care as in the military, and it’s among the reasons that markets are so much better than national centralization.
It’s also among the reasons Paul Ryan’s Medicare reform is so much better than Mr. Obama’s. Beneficiaries would receive a “premium support” payment to buy insurance, and insurers and providers would compete for business on value for money. What “works” is what millions of consumers decide.
The only alternative, and the IPAB’s true end game, is harsher and more arbitrary price controls and eventually limits on the care patients are allowed to receive. The New England Journalists (of Medicine) deny this reality because ObamaCare has a clause that prohibits “rationing,” even as the law leaves that term undefined. But reducing treatment options will be inevitable as government costs explode.
The IPAB revolt among House Democrats comes as the White House demands even more powers for IPAB in its budget, including an automatic sequester. Whatever is motivating House Democrats, they deserve some credit for making Mr. Obama’s vision somewhat less likely.
Copyright 2012 Dow Jones & Company, Inc. All Rights Reserved
PART I–INDIVIDUAL RESPONSIBILITYSEC. 1501. <<NOTE: 42 USC 18091.>> REQUIREMENT TO MAINTAIN MINIMUMESSENTIAL COVERAGE.(a) Findings.–Congress makes the following findings:(1) In general.–The individual responsibility requirementprovided for in this section (in this subsection referred to asthe “requirement”) is commercial and economic in nature, andsubstantially affects interstate commerce, as a result of theeffects described in paragraph (2).[[Page 124 STAT. 243]](2) Effects on the national economy and interstatecommerce.–The effects described in this paragraph are thefollowing:(A) The requirement regulates activity that iscommercial and economic in nature: economic andfinancial decisions about how and when health care ispaid for, and when health insurance is purchased.(B) Health insurance and health care services are asignificant part of the national economy. Nationalhealth spending is projected to increase from$2,500,000,000,000, or 17.6 percent of the economy, in2009 to $4,700,000,000,000 in 2019. Private healthinsurance spending is projected to be $854,000,000,000in 2009, and pays for medical supplies, drugs, andequipment that are shipped in interstate commerce. Sincemost health insurance is sold by national or regionalhealth insurance companies, health insurance is sold ininterstate commerce and claims payments flow throughinterstate commerce.(C) The requirement, together with the otherprovisions of this Act, will add millions of newconsumers to the health insurance market, increasing thesupply of, and demand for, health care services.According to the Congressional Budget Office, therequirement will increase the number and share ofAmericans who are insured.(D) The requirement achieves near-universal coverageby building upon and strengthening the private employer-based health insurance system, which covers 176,000,000Americans nationwide. In Massachusetts, a similarrequirement has strengthened private employer-basedcoverage: despite the economic downturn, the number ofworkers offered employer-based coverage has actuallyincreased.(E) Half of all personal bankruptcies are caused inpart by medical expenses. By significantly increasinghealth insurance coverage, the requirement, togetherwith the other provisions of this Act, will improvefinancial security for families.(F) Under the Employee Retirement Income SecurityAct of 1974 (29 U.S.C. 1001 et seq.), the Public HealthService Act (42 U.S.C. 201 et seq.), and this Act, theFederal Government has a significant role in regulatinghealth insurance which is in interstate commerce.(G) Under sections 2704 and 2705 of the PublicHealth Service Act (as added by section 1201 of thisAct), if there were no requirement, many individualswould wait to purchase health insurance until theyneeded care. By significantly increasing healthinsurance coverage, the requirement, together with theother provisions of this Act, will minimize this adverseselection and broaden the health insurance risk pool toinclude healthy individuals, which will lower healthinsurance premiums. The requirement is essential tocreating effective health insurance markets in whichimproved health insurance products that are guaranteedissue and do not exclude coverage of pre-existingconditions can be sold.(H) Administrative costs for private healthinsurance, which were $90,000,000,000 in 2006, are 26 to30 percent of premiums in the current individual andsmall group[[Page 124 STAT. 244]]markets. By significantly increasing health insurancecoverage and the size of purchasing pools, which willincrease economies of scale, the requirement, togetherwith the other provisions of this Act, willsignificantly reduce administrative costs and lowerhealth insurance premiums. The requirement is essentialto creating effective health insurance markets that donot require underwriting and eliminate its associatedadministrative costs.(3) Supreme court ruling.–In United States v. South-EasternUnderwriters Association (322 U.S. 533 (1944)), the SupremeCourt of the United States ruled that insurance is interstatecommerce subject to Federal regulation.(b) In General.–Subtitle D of the Internal Revenue Code of 1986 isamended by adding at the end the following new chapter:“CHAPTER 48–MAINTENANCE OF MINIMUM ESSENTIAL COVERAGE“Sec. 5000A. Requirement to maintain minimum essential coverage.“SEC. 5000A. <<NOTE: 26 USC 5000A.>> REQUIREMENT TO MAINTAIN MINIMUMESSENTIAL COVERAGE.“(a) Requirement To Maintain Minimum Essential Coverage.–Anapplicable individual shall for each month beginning after 2013 ensurethat the individual, and any dependent of the individual who is anapplicable individual, is covered under minimum essential coverage forsuch month.“(b) Shared Responsibility Payment.–“(1) In general.– <<NOTE: Penalty.>> If an applicableindividual fails to meet the requirement of subsection (a) for 1or more months during any calendar year beginning after 2013,then, except as provided in subsection (d), there is herebyimposed a penalty with respect to the individual in the amountdetermined under subsection (c).“(2) Inclusion with return.–Any penalty imposed by thissection with respect to any month shall be included with ataxpayer’s return under chapter 1 for the taxable year whichincludes such month.“(3) Payment of penalty.–If an individual with respect towhom a penalty is imposed by this section for any month–“(A) is a dependent (as defined in section 152) ofanother taxpayer for the other taxpayer’s taxable yearincluding such month, such other taxpayer shall beliable for such penalty, or“(B) files a joint return for the taxable yearincluding such month, such individual and the spouse ofsuch individual shall be jointly liable for suchpenalty.“(c) Amount of Penalty.–“(1) In general.–The penalty determined under thissubsection for any month with respect to any individual is anamount equal to \1/12\ of the applicable dollar amount for thecalendar year.“(2) Dollar limitation.–The amount of the penalty imposedby this section on any taxpayer for any taxable year withrespect to all individuals for whom the taxpayer is liable undersubsection (b)(3) shall not exceed an amount equal to 300percent the applicable dollar amount (determined without[[Page 124 STAT. 245]]regard to paragraph (3)(C)) for the calendar year with or withinwhich the taxable year ends.“(3) Applicable dollar amount.–For purposes of paragraph(1)–“(A) In general.–Except as provided insubparagraphs (B) and (C), the applicable dollar amountis $750.“(B) Phase in.–The applicable dollar amount is $95for 2014 and $350 for 2015.“(C) Special rule for individuals under age 18.–Ifan applicable individual has not attained the age of 18as of the beginning of a month, the applicable dollaramount with respect to such individual for the monthshall be equal to one-half of the applicable dollaramount for the calendar year in which the month occurs.“(D) Indexing of amount.–In the case of anycalendar year beginning after 2016, the applicabledollar amount shall be equal to $750, increased by anamount equal to–“(i) $750, multiplied by“(ii) the cost-of-living adjustmentdetermined under section 1(f)(3) for the calendaryear, determined by substituting `calendar year2015′ for `calendar year 1992′ in subparagraph (B)thereof.If the amount of any increase under clause (i) is not amultiple of $50, such increase shall be rounded to thenext lowest multiple of $50.“(4) Terms relating to income and families.–For purposesof this section–“(A) Family size.–The family size involved withrespect to any taxpayer shall be equal to the number ofindividuals for whom the taxpayer is allowed a deductionunder section 151 (relating to allowance of deductionfor personal exemptions) for the taxable year.“(B) Household income.–The term `household income’means, with respect to any taxpayer for any taxableyear, an amount equal to the sum of–“(i) the modified gross income of thetaxpayer, plus“(ii) the aggregate modified gross incomes ofall other individuals who–“(I) were taken into account indetermining the taxpayer’s family sizeunder paragraph (1), and“(II) were required to file areturn of tax imposed by section 1 forthe taxable year.“(C) Modified gross income.–The term `modifiedgross income’ means gross income–“(i) decreased by the amount of any deductionallowable under paragraph (1), (3), (4), or (10)of section 62(a),“(ii) increased by the amount of interestreceived or accrued during the taxable year whichis exempt from tax imposed by this chapter, and“(iii) determined without regard to sections911, 931, and 933.“(D) Poverty line.–[[Page 124 STAT. 246]]“(i) In general.–The term `poverty line’ hasthe meaning given that term in section 2110(c)(5)of the Social Security Act (42 U.S.C.1397jj(c)(5)).“(ii) Poverty line used.–In the case of anytaxable year ending with or within a calendaryear, the poverty line used shall be the mostrecently published poverty line as of the 1st dayof such calendar year.“(d) Applicable Individual.–For purposes of this section–“(1) In general.–The term `applicable individual’ means,with respect to any month, an individual other than anindividual described in paragraph (2), (3), or (4).“(2) Religious exemptions.–“(A) Religious conscience exemption.–Such termshall not include any individual for any month if suchindividual has in effect an exemption under section1311(d)(4)(H) of the Patient Protection and AffordableCare Act which certifies that such individual is amember of a recognized religious sect or divisionthereof described in section 1402(g)(1) and an adherentof established tenets or teachings of such sect ordivision as described in such section.“(B) Health care sharing ministry.–“(i) In general.–Such term shall not includeany individual for any month if such individual isa member of a health care sharing ministry for themonth.“(ii) Health care sharing ministry.–The term`health care sharing ministry’ means anorganization–“(I) which is described in section501(c)(3) and is exempt from taxationunder section 501(a),“(II) members of which share acommon set of ethical or religiousbeliefs and share medical expenses amongmembers in accordance with those beliefsand without regard to the State in whicha member resides or is employed,“(III) members of which retainmembership even after they develop amedical condition,“(IV) which (or a predecessor ofwhich) has been in existence at alltimes since December 31, 1999, andmedical expenses of its members havebeen shared continuously and withoutinterruption since at least December 31,1999, and“(V) which conducts an annual auditwhich is performed by an independentcertified public accounting firm inaccordance with generally acceptedaccounting principles and which is madeavailable to the public upon request.“(3) Individuals not lawfully present.–Such term shall notinclude an individual for any month if for the month theindividual is not a citizen or national of the United States oran alien lawfully present in the United States.“(4) Incarcerated individuals.–Such term shall not includean individual for any month if for the month the individual isincarcerated, other than incarceration pending the dispositionof charges.“(e) Exemptions.–No penalty shall be imposed under subsection (a)with respect to–“(1) Individuals who cannot afford coverage.–[[Page 124 STAT. 247]]“(A) In general.–Any applicable individual for anymonth if the applicable individual’s requiredcontribution (determined on an annual basis) forcoverage for the month exceeds 8 percent of suchindividual’s household income for the taxable yeardescribed in section 1412(b)(1)(B) of the PatientProtection and Affordable Care Act. For purposes ofapplying this subparagraph, the taxpayer’s householdincome shall be increased by any exclusion from grossincome for any portion of the required contribution madethrough a salary reduction arrangement.“(B) <<NOTE: Definition.>> Requiredcontribution.–For purposes of this paragraph, the term`required contribution’ means–“(i) in the case of an individual eligible topurchase minimum essential coverage consisting ofcoverage through an eligible-employer-sponsoredplan, the portion of the annual premium whichwould be paid by the individual (without regard towhether paid through salary reduction orotherwise) for self-only coverage, or“(ii) in the case of an individual eligibleonly to purchase minimum essential coveragedescribed in subsection (f)(1)(C), the annualpremium for the lowest cost bronze plan availablein the individual market through the Exchange inthe State in the rating area in which theindividual resides (without regard to whether theindividual purchased a qualified health planthrough the Exchange), reduced by the amount ofthe credit allowable under section 36B for thetaxable year (determined as if the individual wascovered by a qualified health plan offered throughthe Exchange for the entire taxable year).“(C) Special rules for individuals related toemployees.–For purposes of subparagraph (B)(i), if anapplicable individual is eligible for minimum essentialcoverage through an employer by reason of a relationshipto an employee, the determination shall be made byreference to the affordability of the coverage to theemployee.“(D) <<NOTE: Applicability. Determination.>>Indexing.–In the case of plan years beginning in anycalendar year after 2014, subparagraph (A) shall beapplied by substituting for `8 percent’ the percentagethe Secretary of Health and Human Services determinesreflects the excess of the rate of premium growthbetween the preceding calendar year and 2013 over therate of income growth for such period.“(2) Taxpayers with income under 100 percent of povertyline.–Any applicable individual for any month during a calendaryear if the individual’s household income for the taxable yeardescribed in section 1412(b)(1)(B) of the Patient Protection andAffordable Care Act is less than 100 percent of the poverty linefor the size of the family involved (determined in the samemanner as under subsection (b)(4)).“(3) Members of indian tribes.–Any applicable individualfor any month during which the individual is a member of anIndian tribe (as defined in section 45A(c)(6)).“(4) Months during short coverage gaps.–“(A) In general.–Any month the last day of whichoccurred during a period in which the applicableindividual[[Page 124 STAT. 248]]was not covered by minimum essential coverage for acontinuous period of less than 3 months.“(B) <<NOTE: Applicability.>> Special rules.–Forpurposes of applying this paragraph–“(i) the length of a continuous period shallbe determined without regard to the calendar yearsin which months in such period occur,“(ii) if a continuous period is greater thanthe period allowed under subparagraph (A), noexception shall be provided under this paragraphfor any month in the period, and“(iii) if there is more than 1 continuousperiod described in subparagraph (A) coveringmonths in a calendar year, the exception providedby this paragraph shall only apply to months inthe first of such periods.The Secretary shall prescribe rules for the collectionof the penalty imposed by this section in cases wherecontinuous periods include months in more than 1 taxableyear.“(5) Hardships.–Any applicable individual who for anymonth is determined by the Secretary of Health and HumanServices under section 1311(d)(4)(H) to have suffered a hardshipwith respect to the capability to obtain coverage under aqualified health plan.“(f) Minimum Essential Coverage.–For purposes of this section–“(1) <<NOTE: Definition.>> In general.–The term `minimumessential coverage’ means any of the following:“(A) Government sponsored programs.–Coverageunder–“(i) the Medicare program under part A oftitle XVIII of the Social Security Act,“(ii) the Medicaid program under title XIX ofthe Social Security Act,“(iii) the CHIP program under title XXI ofthe Social Security Act,“(iv) the TRICARE for Life program,“(v) the veteran’s health care program underchapter 17 of title 38, United States Code, or“(vi) a health plan under section 2504(e) oftitle 22, United States Code (relating to PeaceCorps volunteers).“(B) Employer-sponsored plan.–Coverage under aneligible employer-sponsored plan.“(C) Plans in the individual market.–Coverageunder a health plan offered in the individual marketwithin a State.“(D) Grandfathered health plan.–Coverage under agrandfathered health plan.“(E) Other coverage.–Such other health benefitscoverage, such as a State health benefits risk pool, asthe Secretary of Health and Human Services, incoordination with the Secretary, recognizes for purposesof this subsection.“(2) Eligible employer-sponsored plan.–The term `eligibleemployer-sponsored plan’ means, with respect to any[[Page 124 STAT. 249]]employee, a group health plan or group health insurance coverageoffered by an employer to the employee which is–“(A) a governmental plan (within the meaning ofsection 2791(d)(8) of the Public Health Service Act), or“(B) any other plan or coverage offered in thesmall or large group market within a State.Such term shall include a grandfathered health plan described inparagraph (1)(D) offered in a group market.“(3) Excepted benefits not treated as minimum essentialcoverage.–The term `minimum essential coverage’ shall notinclude health insurance coverage which consists of coverage ofexcepted benefits–“(A) described in paragraph (1) of subsection (c)of section 2791 of the Public Health Service Act; or“(B) described in paragraph (2), (3), or (4) ofsuch subsection if the benefits are provided under aseparate policy, certificate, or contract of insurance.“(4) Individuals residing outside united states orresidents of territories.–Any applicable individual shall betreated as having minimum essential coverage for any month–“(A) if such month occurs during any perioddescribed in subparagraph (A) or (B) of section911(d)(1) which is applicable to the individual, or“(B) if such individual is a bona fide resident ofany possession of the United States (as determined undersection 937(a)) for such month.“(5) Insurance-related terms.–Any term used in thissection which is also used in title I of the Patient Protectionand Affordable Care Act shall have the same meaning as when usedin such title.“(g) Administration and Procedure.–“(1) In general.–The penalty provided by this sectionshall be paid upon notice and demand by the Secretary, andexcept as provided in paragraph (2), shall be assessed andcollected in the same manner as an assessable penalty undersubchapter B of chapter 68.“(2) Special rules.–Notwithstanding any other provision oflaw–“(A) Waiver of criminal penalties.–In the case ofany failure by a taxpayer to timely pay any penaltyimposed by this section, such taxpayer shall not besubject to any criminal prosecution or penalty withrespect to such failure.“(B) Limitations on liens and levies.–TheSecretary shall not–“(i) file notice of lien with respect to anyproperty of a taxpayer by reason of any failure topay the penalty imposed by this section, or“(ii) levy on any such property with respectto such failure.”.(c) Clerical Amendment.–The table of chapters for subtitle D of theInternal Revenue Code of 1986 is amended by inserting after the itemrelating to chapter 47 the following new item:“Chapter 48–Maintenance of Minimum Essential Coverage.”.(d) <<NOTE: 26 USC 5000A note.>> Effective Date.–The amendmentsmade by this section shall apply to taxable years ending after December31, 2013.[[Page 124 STAT. 250]]