Bloomberg News

House Votes to Drop Medicare Board From Health-Care Law

March 23, 2012

The Republican-led U.S. House voted to eliminate a Medicare advisory board from the 2010 health-care overhaul days before the U.S. Supreme Court hears arguments on the law’s constitutionality.

The measure, H.R. 5, passed yesterday on a 223-181 vote. It also would cap awards in medical-malpractice claims for pain and suffering at $250,000 in most states.

President Barack Obama signed the health-care law, known as the Affordable Care Act, two years ago today. It is intended to extend insurance coverage to tens of millions of uninsured Americans, impose new taxes on the highest wage earners and produce savings in Medicare, the health-care system for the elderly. The Supreme Court hears arguments March 26-28 on legal challenges to the law.

The Independent Payment Advisory Board, composed of 15 presidentially appointed members, would recommend cuts in Medicare payments to doctors, hospitals and other health-care providers. The board’s members haven’t been selected thus far.

“I am the first one to tell you how much I am opposed” to the advisory board, said Representative Frank Pallone of New Jersey, who was among Democrats who said they were disappointed that Republican leaders merged the repeal with medical malpractice liability provisions they oppose.

Republicans “have no interest in truly repealing” the advisory board, Pallone said. “They only care about defacing the Affordable Care Act and continuing their political game of repealing the law piece by piece.”

Veto Threat

The White House threatened a veto of the bill on March 20, calling the advisory board “an important safeguard” to rein in Medicare cost growth. The message from the U.S. Office of Management and Budget said the malpractice award caps would create “inappropriate and harmful restrictions” without reducing preventable injuries or improving the quality of care.

The medical malpractice provisions would limit fees to lawyers that are based on a percentage of a damage award, set guidelines for punitive award limits and create a deadline for filing the lawsuits.

The House has passed similar medical liability provisions, including in 2002, 2003 and 2005. The proposals didn’t advance in the Senate, now controlled by Democrats.

Starting in 2015, the payment advisory board would have the ability to recommend cuts of as much as 0.5 percent of Medicare spending, increasing to 1.5 percent for 2018 and beyond. The board’s recommendations would automatically take effect unless Congress passed its own spending reductions that matched the amount recommended by the board.

‘Medical IRS’

“It’s going to be more like a medical IRS than an advisory panel,” said Representative Charlie Dent, a Pennsylvania Republican, referring to the Internal Revenue Service. The board’s purpose “is to save money by restricting access to health care for Medicare beneficiaries,” he said.

The medical liability provisions in the bill would reduce the federal budget deficit by $48.6 billion over 10 years, while repealing the Medicare advisory board would increase the deficit by $3.1 billion, according to a March 19 Congressional Budget Office estimate.

Medical associations and the U.S. Chamber of Commerce are among the bill’s supporters. Opponents include trial lawyers’ associations, consumer advocacy groups and state legislatures.

To contact the reporter on this story: Michelle Jamrisko in Washington at mjamrisko@bloomberg.net

To contact the editor responsible for this story: Katherine Rizzo at krizzo5@bloomberg.net


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