Tuesday, June 14, 2011

Independent Payment Advisory Board (IPAB)-what could go wrong with that?

The IPAB which was inserted into Obamacare at the last minute without anything approaching proper legislative review and contemplation establishes a 15 member panel appointed by the President which will beginning in 2014 have unprecedented power to control medical spending in the country with almost no significant or likely effective congressional oversight.

Now what could possibly be wrong with that?

James Madison had some thoughts about that.He was concerned about what he referred to as "factions' which today would be thought of as special interest groups.Special interest groups have developed a potent skill set to influence government bodies to focus benefits on themselves while the cost are diffused.

In general, the founding fathers of the country has some thoughts about what could be wrong with that sort of entity.They tried to design a government not so that wise leaders could do great good but rather one that would limit the damage done by fools,thugs and would be despots who might(most assuredly would) find their way to influential posts in government.

Their wisdom seemed brushed aside as the view of a benevolent and wise government assumed the default position as it was persistently promoted by a cadre of progressive minded academia intellectuals and high school civics texts which visualized a government that would wisely recognize problems,devise safe and effective solutions and then without special favors execute remedial plans marvelously bereft of significant unintended consequences.

Fortunately, James Buchanan and Gordon Tullock resurrected Madisonian wisdom, enlarged upon it and explicated the theory of public choice which basically asserts that government officials and bureaucrats display the same characteristics as other humans, namely a proclivity to look after their own self interest. They definitely has some thoughts about what could possibly go wrong with something like the IPAB.

The economist, George Stigler,who did much to develop the concept of regulatory capture might have some to say about what could go wrong with the IPAB.Governmental agencies and organizations can be subject to the influence of the very groups that they are created to regulate and control to regulate and control.

Mafia dons and wise guys alike know the explanatory value of the "follow the money" and could explain simply what could go wrong with the IPAB.

Big Pharma had supported the passage of ACA but it is hard to believe that their support would have been forthcoming had they realized what IPAB would be.They certainty recognize the danger now.

The American College of Physicians (ACP) also supported Obamacare but now express opposition to the IPAB section "as written".Although (unfortunately in my view) they do not recommend repeal of IPAB but instead want certain changes that would make the entity acceptable.See here for ACP's position which objects to the exemption of hospitals and hospices from IPAB's edicts until 2019,the absence of primary care physicians on the panel,the lack of a mechanisms for significant congressional oversight and for preserving quality while decreasing costs.

So, much can go very,very wrong with IPAB but it gets even worse. Go here to read a recent commentary by George Will which discusses the chilling thought that the IPAB may not be stoppable. It may well be " entrenched".

Entrenchment refers to one legislative body passing a law that contains provisions that prohibit later legislature from repeal the law.

Can a legislative body really pass a law that contains a wording to prohibit further changes in that law?Is the IMAB really an immutable entity?

Eric Posner discusses it here and, as best I can translate it from the legal dialect academic lawyers speak into everyday English is that the Supreme Court has decided that they cannot allow that but as with anything that might be litigated there are at least as many sides to the issue as there are interests who can loose or gain from a decision.

It is hard to find a better summation that the one penned by Mr. Will in his above cited recent column:

"The essence of progressivism, and of the administrative state that is progressivism’s project, is this doctrine: Modern society is too complex for popular sovereignty, so government of, by and for supposedly disinterested experts must not perish from the earth. "

And the corollary for progressive medicine is that "medical care is too important and complex to be left to the individual physician and the individual patient."

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