Kudos to Congress for Repealing IPAB!

by Naomi Lopez and Christina Sandefur
March 7, 2018

Partisan gridlock in Congress is often the rule, but there are the occasional and notable exceptions. In the recent spending bill, lawmakers successfully repealed the Independent Payment Advisory Board (IPAB).

Enacted eight years ago as part of the Affordable Care Act (ACA), IPAB was one of the greatest and most disturbing power grabs in American history. While created as a cost-saving mechanism for the Medicare program for the nation’s elderly, IPAB’s authority was far broader. The Board—whose 15 members were not elected by the American people—wielded unprecedented power to write healthcare rules that would automatically become law without a vote of Congress, signature of the president, notice to the public, or review by the courts.

Some fiscal conservatives are now lamenting the fact that, by repealing IPAB, Congress has removed important checks on uncontrolled Medicare spending. This is an issue that should not be ignored. True, the Medicare program is in desperate need of modernization and financial overhaul, and IPAB would have been a tool to control those costs. But the costs to our Constitution would have been far greater. Those doubting the dangers that IPAB posed should consider the following:

IPAB’s authority was not limited to Medicare. IPAB had much broader powers to make law governing both government and private healthcare—whatever the Board considered “related to the Medicare program.” IPAB’s toolbox was vast: It could enact price controls and even levy taxes. And those decisions would have been free of any meaningful checks or balances.

IPAB’s power was consolidated in one individual. Some viewed Congress’s repeal of IPAB as premature—after all, neither President Obama nor Trump had appointed any members to the Board, and it had not yet taken any actions. But lack of membership was only more cause for concern. So long as IPAB remained unstaffed, the Secretary of Health and Human Services alone wielded the Board’s vast powers.

IPAB’s decisions were not subject to judicial review. IPAB’s so-called “recommendations” would have automatically become law, without review by Congress or the courts. In other words, the ACA left unaccountable bureaucrats free to make decisions that could affect public and private healthcare for millions of Americans.

IPAB had the power to ration care. Many mistakenly believed that IPAB was prohibited from rationing healthcare. But what constitutes rationing? The ACA never defined “rationing care”—instead, it left the Board to define rationing however it wished, and it prohibited patients and doctors from turning to the courts for protection if the Board stopped them from receiving or delivering care. In other words, IPAB put bureaucrats in charge of deciding what type and how much medical care people should receive. That system would have deprived patients of access to needed care—increasing centralized decision making at the expense of individual healthcare decisions.

IPAB was the most extreme example of consolidated, unchecked government power in American history. The U.S. Constitution gives the lawmaking power to Congress alone because legislators are responsible to their constituents and checked by the other branches of government. No agency can be rendered exempt from democratic processes and the rule of law. That is why Congress should be lauded for repealing the unchecked and unprecedented consolidation of bureaucratic power.

The Goldwater Institute brought the only lawsuit challenging IPAB in 2010. Unfortunately, the Ninth Circuit Court of Appeals had refused to consider that challenge during the Obama administration, saying that the President had not yet appointed anyone to staff IPAB, and declining to rule until IPAB flexes its muscles.

But it is the unconstitutional lawmaking process itself—not any particular edict—that we were challenging. Given IPAB’s unprecedented immunity from control by any of the three constitutional branches of government, it might very well have been too late to decide the case later. Fortunately, Congress took action to protect patients, doctors, and the Constitution.

Lawmakers have the duty to revisit the Medicare program and pursue needed reforms. But these reforms should be crafted in the light of day, with real accountability, and in a manner that empowers patients to pursue their healthcare priorities and preferences.

Naomi Lopezis the director of healthcare policy and Christina Sandefur is the executive vice president and litigator at the Goldwater Institute.