Currently, Medicare policy is made largely by Congress and, to varying degrees, the Centers for Medicare and Medicaid Services (CMS). The proposals being debated would essentially create an independent body of health care experts with the power to make fundamental decisions affecting Medicare. Advocates of these types of proposals argue that creating an independent, policymaking entity in Medicare is necessary if we hope to achieve any real health care reform. Supporters claim that members of Congress are easily influenced by special interests and lobbyists when making Medicare policy decisions, particularly those related to provider reimbursement. As a result, some of the decisions that are made may not be fiscally sustainable or in the best interest of beneficiaries. Advocates also contend that lawmakers do not have the necessary technical or operational expertise required to govern a program as complex as Medicare. Opponents of these proposals express concern about reducing Congress's role in the policymaking and oversight process. The proposals being discussed would establish a new policymaking body with the authority to make changes in the program without congressional approval. On June 25, 2009, Senator Jay Rockefeller introduced S. 1380 , the Medicare Payment Advisory Commission (MedPAC) Reform Act of 2009, which would elevate MedPAC, a congressional advisory commission, to an executive branch agency with the authority to determine Medicare payment and coverage policies. The Obama administration submitted a similar proposal to Congress, titled the Independent Medicare Advisory Council Act (IMAC) of 2009, on July 17, 2009. The Administration's proposal would create an independent five-member executive council charged with issuing recommendations on Medicare payment policy to the President. Finally, the Senate Finance Committee included a provision to establish an independent Medicare advisory board in its health reform legislation, the Patient Protection and Affordable Care Act ( H.R. 3590 ), which passed the Senate on December 24, 2009. This report introduces readers to the concept of creating an independent, policymaking entity in Medicare. The report begins with a discussion of the types of policymaking entities that have been proposed in the current health care reform debate, as well as in Medicare. The report then provides an overview of the role that Congress and CMS play in determining Medicare policy. The report concludes with a comparison of some of the key features of S. 1380 , the Administration's draft IMAC proposal, and H.R. Congress has debated the merits of creating a new administrative entity in Medicare several times throughout the program's history, most recently in the Medicare reform discussions of 2000 and 2001. 3590 would have the authority to develop and submit recommendations, in certain years, to Congress and the President to reduce Medicare spending.
Current health care reform discussions have included debates about the merits of creating an independent entity in Medicare to make changes in the program. Currently, Medicare policy is made largely by Congress and, to varying degrees, the Centers for Medicare and Medicaid Services (CMS), the federal agency responsible for administering the program. The proposals being debated would essentially create an independent body of experts with the power to set provider payment rates and make other Medicare policy decisions.
Advocates of these types of proposals argue that creating a new independent entity or governance structure in Medicare is necessary if we hope to achieve any real health care reform, particularly reductions in overall spending. According to supporters, members of Congress are easily influenced by special interests and lobbyists when developing Medicare policies, particularly those related to provider reimbursement. As a result, some of the decisions that are made may not be fiscally sustainable or in the best interest of beneficiaries. Additionally, proponents argue that members do not have the technical expertise or professional experience required to manage a health insurance program as complex as Medicare. They contend that the public would be better served by having independent experts, insulated from political pressures, responsible for making Medicare policy.
Opponents of these proposals express concern about reducing Congress's role in the Medicare policymaking and oversight process. Under the proposals being discussed, recommendations made by the new commission or decision-making entity would automatically become law without congressional action. Critics contend that giving too much power to an entity composed of unelected officials would reduce its accountability to Congress and the public.
Over the past year, several proposals have been introduced by Congress to create a new administrative or governing structure in Medicare. On June 25, 2009, Senator Jay Rockefeller introduced S. 1380, the Medicare Payment Advisory Commission (MedPAC) Reform Act of 2009, which would elevate MedPAC, a congressional advisory commission, to an executive branch agency. The Obama Administration submitted a similar proposal to Congress titled the Independent Medicare Advisory Council Act (IMAC) on July 17, 2009. The Administration's draft proposal would create an independent five-member executive council to make recommendations to the President. Finally, the Senate Finance Committee included a provision establishing an independent Medicare advisory board in its health reform legislation, the Patient Protection and Affordable Care Act (H.R. 3590), which passed the Senate on December 24, 2009. All proposals would transfer certain Medicare oversight and decision-making responsibilities to an independent, policymaking entity.
This report introduces readers to the concept of creating an independent, policymaking entity in Medicare. The report begins with a discussion of the types of policymaking entities that have been proposed in the current health care reform debate, as well as in Medicare. The report then provides an overview of the role that Congress and CMS play in determining Medicare policy. The report concludes with a comparison of some of the key features of S. 1380, the Administration's draft IMAC proposal, and H.R. 3590.