Rep. Ryan Quizzes Sebelius On Increased Savings Estimate From IPAB

The panel hasn’t had a meeting and no one’s even been nominated for it yet, but the Obama administration’s fiscal 2015 budget request says the health law’s Independent Payment Advisory Board, also known as IPAB, could save the government triple what officials estimated last year.

Rep. Paul Ryan at a hearing on health care in 2010 (Photo by Alex Wong/Getty Images).

On Wednesday, Rep. Paul Ryan, R-Wis.,  asked Department of Health and Human Services Secretary Kathleen Sebelius how the agency determined that IPAB savings would be $12.9  billion over the next decade and why it was so much higher than the fiscal 2014 budget estimate, which was $4 billion. “The question is, where does it come from?” Ryan asked.

In testimony before the House Ways and Means Committee, Sebelius attributed the increase to actuarial estimates that Medicare costs will rise more rapidly in the later years of the budget’s 10 year window. Nonetheless, she said, HHS officials are not convinced that those estimates are correct since Medicare spending growth has slowed  in recent years and Sebelius said she was hopeful that trend would continue.

One of the most contentious provisions of the health law, IPAB is a 15-member panel charged with making recommendations to reduce Medicare spending if the amount the government spends grows beyond a target rate. If Congress chooses not to accept the recommendations, lawmakers must pass alternative cuts of the same size or the IPAB recommendations go into effect.

Some Republicans argue that the board’s efforts would amount to health care rationing, and some Democrats have said that they think the panel would transfer power that belongs on Capitol Hill to the executive branch. The House has voted to repeal IPAB but the Senate did not consider the measure.

Ryan, who also chairs the House Budget Committee,  asked Sebelius when Congress would get more details about who the president has in mind to serve on IPAB. “I think the president intends to submit names,” Sebelius said.

This article was produced by Kaiser Health News with support from The SCAN Foundation.