Dictatorial Entitlement Solution
by Donald Devine
Issue 221– February 13, 2013
The intelligentsia loved to criticize Sarah Palin for exaggerating the power of what she called Obamacare’s “death panel.” We should be so lucky that she knew the whole story. It now turns out only one person will be able to impose rationing of health care rather than a panel.
The Washington Post by now has had time to read the law, two years after its passage. According to the statute, the Post now advises us that if the Independent Payment Advisory Board (IPAB) panel’s member positions go unfilled or are blocked for confirmation, Secretary of Health and Human Services Kathleen Sebelius can manage Medicare all by herself, and through its reimbursement schedules influence all health provider rates and coverage!
The law grants IPAB the power to set what the government will reimburse as fees-for-services under Medicare, with separate schedules of payments for hospital inpatient services, outpatient services, physician services, home care and nursing home services, outpatient drugs, and other health devices and services. Before Obamacare Congress often voted to increase the payments to health providers when HHS Medicare schedules seemed to be paying too little to get physicians to perform services or take new patients. In order to eliminate this political check on its authority, Obamacare gave IPAB power to lower rates further if Medicare grew more than one percentage point faster than the economy. Congress would have to approve any decision but if Congress did not act – which of course it will not with the Democratic Senate and Republican House in deadlock – then the IPAB decision would be final.
The Post has also discovered that no one wants to be appointed to the 15 member board. The pay is relatively low by Washington standards and members are forbidden to take outside employment. Obama’s then director of the Office of Management and Budget, Peter Orszag, now tells us “It will be challenging to find 15 top health care experts who would want to fill that job.” A former Obama health advisor Robert Kocher says “it does not make sense” for top experts to sign up for low pay and high controversy, which later will ultimately spread from Medicare to all decisions under Obamacare. If they cannot find anyone, it will be up to Sec. Sebelius alone to decide what every health provider in America is paid and what he may do.
Ms. Sebelius is in a bit of trouble already with her rules regarding religious exemptions from Obamacare’s mandatory insurance coverage for abortifacients and contraceptives. The original proposals set off a firestorm from religious traditionalists since only churches could claim exemption from providing and paying for “free” insurance coverage they view as immoral. Other religious and secular organizations such as charities and schools with the same moral concerns could not escape the provisions. Recently revised rules expanded the exemption to religious orders but not to religious universities or most such high schools (and maybe not to grade schools), or charities (except ones directly operating from a church), or certainly not to private businesses with religious objections.
The original proposal attempted to insulate non-exempt religious organizations from taking action they considered immoral by shifting — at least nominally – the cost and administration of the objected-to services to either the health insurance issuer (such as Blue Cross) or to the school or charity plan administrator (for self-insured entities). The new rules refine this further to allow insurers to create health plans for objecting religious groups without abortifacient and contraceptive coverage but require the health plan insurer to write each insured person to inform them that free coverage for these items can be obtained directly from the insurers. To dispose of the indirect payment problem, the government would subsidize the insurers’ costs. This provision should only aggravate the situation further since government subsidies are given to tell religious employees how to violate their religious employers’ moral doctrines.
Not surprisingly lawsuits against HHS have exploded. Suits on behalf of secular religious objectors have advanced rapidly since challenges from religious non-profits were given a “safe harbor” against the regulations until August 2013 before they can go to court. Already, the federal appeals court in the Seventh and Eighth Circuits have granted preliminary injunctions to several private companies putting the regulation on hold for those companies until there is a ruling on their merits. No doubt the new rules will generate even more litigation. Meanwhile, it seems every week a new cost or hidden restriction on future care pops up as a result of newly-discovered provisions in Obamacare. The Congressional Budget Office has just questioned the law’s whole financial basis, which will further inflame a public that the polls show has been opposed to the reforms from the very beginning.
Sec. Sebelius will need dictatorial power to pull this off. Unfortunately, most of the opposition has focused on keeping the costs of Obamacare down. The real issue is who decides who can get what care at what price, each one of us in a market or Ms. Sebelius? President Obama and Director Orszag have promised from the beginning that costs would be controlled by the government “bending the health cost curve downwards.” We foolish people thought this would be impossible because even though the silly system would not work Congress would step in as in the past if only for political survival reasons when people stop receiving health care. We fools assumed the Constitution was still in effect. We did not realize Congress had passed its power over to a single person who can act totally on her own.
It now looks like the president was correct. Obamacare will work. Dictator Sebelius will ration care and the entitlement crisis will be solved as the number of seniors drops dramatically as health providers refuse to treat them at Sebelius’ too-low reimbursement rates. Obamacare will work but not in the way anyone except Obama and his pals supposed it would.
Donald Devine, the editor of ConservativeBattleline On Line, was the director of the U.S. Office of Personnel Management from 1981-1985 under Ronald Reagan and is Senior Scholar at The Fund for American Studies.