'Nuclear Option' Revives a Big, Controversial Part of Obamacare

Obama can now fill a cost-cutting board that Republicans want to repeal.

PANORAMA CITY, CA - JANUARY 28: Dr. Jason Greenspan (L) and emergency room nurse Junizar Manansala care for a patient in the ER of Mission Community Hospital where doctors held a press conference outside on a class action lawsuit against the state of California by a coalition of emergency room physicians claiming that without additional funding, the entire emergency healthcare system is on the verge of collapse on January 28, 2009 in Panorama City, California. According to the coalition, the cost of providing emergency room treatment has nearly doubled over the past decade and patient load increased by more than 28 percent while Medi-Cal reimbursements have remained largely unchanged. During that time, 85 California hospitals in California have closed and an additional 55 facilities have shut down their emergency rooms. California now reportedly ranks worst in the nation for access emergency care and last in emergency rooms per capita. California has seven emergency rooms per million people while the national average is 20 emergency rooms per million people.  (National Journal)

The Senate's decision to go "nuclear" breathes new life into a dormant but extremely controversial part of Obamacare.

The Senate's rules change will likely make it much easier for President Obama to fill the Independent Payment Advisory Board, or IPAB — a 15-member panel tasked with slowing the growth in Medicare spending. The IPAB is a polarizing piece of the Affordable Care Act: It's been a feature of GOP campaign ads, and the House has voted to repeal it.

The IPAB is technically supposed to submit its first proposed cuts in January, but Obama hasn't even nominated anyone to the board yet. Nominees have to be confirmed by the Senate, which until today required 60 votes — and Republicans were highly unlikely to help confirm anyone to the board.

But now that the Senate has moved to a 51-vote threshold for executive appointments, Obama will likely be able to fill the board and move ahead with one of the most significant cost-control measures in his signature health care law — if he wants to.

A GOP Senate aide confirmed that the rules change will apply to IPAB nominees; spokespeople for Majority Leader Harry Reid, D-Nev., and the White House did not respond to questions about the rules change and the health care board.

Obama might not want to appoint anyone to the IPAB before next year's midterms, even if he could get them confirmed more easily. The nominations would certainly trigger a fresh debate over his health care law and its cuts in Medicare spending.

Plus, Medicare's trustees say the program's costs are growing so slowly on their own that the IPAB wouldn't even be triggered until at least 2015. The IPAB's charge, under the Affordable Care Act, is to make targeted cuts in Medicare's payments to doctors and health care providers if the program's overall costs grow faster than a certain rate.

Technically, the board only recommends cuts to Congress, but the process is structured so that its cuts are highly likely to take effect. Congress has to proactively block the IPAB's recommendations and come up with equivalent savings somewhere else in the budget.

GOP critics oppose the IPAB largely because it puts the power to set Medicare payments in the hands of unelected experts. Supporters say that's exactly the point: Congress lacks the political will to actually make meaningful cuts to doctors, hospitals, and other providers, so an administrative panel is the only way to control Medicare's costs.

Republicans are also afraid that the IPAB will "ration" care. The law prohibits the board from "rationing," and it is not allowed to cut seniors' benefits — only providers' payments. But critics say the board will drive payments so low that doctors in certain fields will quit accepting Medicare payments.

The policy is popular with a large number of academics and health care wonks — it was the pet project of Peter Orszag, who led the White House budget office during the health care debate. But doctors, pharmaceutical companies, and other health care providers strongly support repealing the board.