The Journal cited several concerns about the new board, which has the power to cut physician payment but not hospital payment in initial years. Among them are the following:
Will Congress cooperate with cuts? A three-fifths Senate majority would be necessary to override payment cuts, but Congress could increase Medicare funding through independent legislation.
Will it save as much as predicted? The Congressional Budget Office said the board would reduce Medicare spending by $28 billion from 2010-2019, but the CMS actuary has questioned this goal.
Will it drive physicians away from Medicare? If the board's Medicare cuts widen the gap between Medicare and private reimbursements, more physicians and other providers might abandon Medicare.
Here is how the board will operate:
- It will be made up of 15 members appointed by the president for six-year terms, plus three HHS officials.
- Beginning in 2012, it will receive $15 million a year for operations, which will increase with inflation in subsequent years.
- Beginning in 2015, it will direct HHS on specific ways to reduce per-capita Medicare spending in years when spending is expected to exceed target levels.
- Congress can overrule the board's cuts, but only if it adopts equally effective alternatives.
- The board can cut physician payments, but if Congress replaces the sustainable growth rate formula, part of the deal may be to limit the board's powers over physician cuts.
- Before 2020, the board may not cut hospital rates because they are already singled out for cuts.
- It will submit annual reports on healthcare costs, access, quality and utilization.
- It will make recommendations on ways to slow spending growth in the private healthcare market.
Read the New England Journal of Medicine report on Medicare payments.