White House Plan Would Create New Agency To Set Medicare Pay Rates
On Wednesday, the White House began circulating draft legislation that would create a new executive agency to oversee Medicare reimbursement rates and policy changes, Politico reports.
Details of Proposal
Under the legislation, members of the five-member Independent Medicare Advisory Council would serve five-year terms and be nominated by the president and subject to Senate approval. According to Politico, council members likely would be doctors or have expertise in health policy.
The members would be paid.
The council would have the authority to make broad Medicare recommendations, but its primary focus would be setting payment rates for Medicare Part A and Part B services. The council's recommendations would come in the form of two annual reports:
- One by Dec. 31 each year that would address reimbursement rates for Medicare Part B; and
- One by Oct. 1 each year that would address reimbursement rates for Medicare Part A.
The agency's recommendations would be sent to the White House for the president's approval.
Within 30 days, the president would be required to inform Congress of his approval or veto of the recommendations. The president would not have line-item veto authority on the recommendations.
If the recommendations are approved by the president, Congress would have 30 days to summon majorities in both houses and overcome a potential Senate filibuster.
The legislation would go into effect Sept. 15, 2014 -- after President Obama's first term has been completed.
According to Politico, a reason for the delay in implementation might be because of the shift in power away from the legislative branch that the move represents.
Difference From MedPAC
The agency would vary from the Medicare Payment Advisory Commission -- which currently makes recommendations to Congress on Medicare spending -- as MedPAC only makes recommendations, which do not have any legal impact.
In addition, some MedPAC critics say that the current system is "too rife with politics and special interests," according to Politico (Rogers, Politico, 7/15).
On Wednesday, the Obama administration also sent Congress a proposal that would give MedPAC the authority to determine cuts and other changes to Medicare.
Rep. Jim Cooper (D-Tenn.), said of MedPAC, "It's not perfect, but it does a lot better job than what Congress is doing."
Cooper is sponsoring the proposal with Sen. Jay Rockefeller (D-W.Va.), a senior member of the Senate Finance Committee.
Administration officials say the move is part of an effort to slow the rising costs of Medicare.
White House Chief of Staff Rahm Emanuel said, "Structures that fundamentally alter the long-term costs are a must for real health care reform," adding that the Medicare payment debate is "the least talked-about, most important issue on the table."White House Office of Management and Budget Director Peter Orszag said, "We're trying to create a structure where that would be easier to reorient the system towards higher value and lower cost in the future" (Murray, Washington Post, 7/16). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.