Cost-cutting commission sends fear down K Street

K Street is getting nervous that it will lose its ability to influence Medicare policy thanks to growing enthusiasm for an independent commission that would limit Congress’s authority on a program that accounts for 14 percent of the federal budget.

President Obama has been promoting the creation of the Independent Medicare Advisory Commission, made up of physicians and healthcare policy experts, which would issue recommendations for Medicare payment rates and payment policies that Congress would then vote on — a system that would give healthcare interest groups little say in the decision process.

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Lawmakers are usually loath to give up any of the legislative branch’s authority, but Democrats are growing interested in the idea as a way of boosting the potential for their healthcare reform bills to reduce healthcare spending.

“It would help to insulate Medicare policy decisions from undue political influence, while at the same time preserving a say for our democratically elected representatives,” White House Office of Management and Budget Director Peter Orszag said Wednesday.

But insulating that process from the political process, as supporters advocate, would also mean that healthcare providers, patient groups and local business owners would have fewer opportunities to persuade lawmakers about the potential harm of cutting Medicare payments.

Healthcare lobbyists fear the proposal could reduce the federal government’s accountability to providers that depend on Medicare dollars to stay in business.

Healthcare providers have reason to worry that their voices might not be heard if Congress’s involvement is reduced, said Mary Grealy, the president of the Healthcare Leadership Council, a body composed of healthcare company CEOs. “How do you make sure that the information from these people gets heard?” she asked.

“It’s putting a lot of faith in unelected people on something that is very critical,” said Chip Kahn, the president of the Federation of American Hospitals. The proposal also incorrectly “presumes and assumes that we have all the answers and it’s just a question of somebody imposing them,” he said.

On Wednesday, the American Hospital Association, which has membership in every congressional district, asked its members to contact their respective lawmakers and urge them to oppose the commission.

And in a letter to Speaker Nancy Pelosi (D-Calif.) sent Wednesday, the American Osteopathic Association spelled it out in clear terms: Including an independent Medicare commission in the House healthcare reform bill “would cause us to reevaluate our support for this legislation.”

The commission “would limit severely congressional oversight of the Medicare program and replace the transparency of congressional hearings and debate with a less transparent process with, at best, minimal accountability for its policy decisions,” wrote Larry Wickless, the president of the osteopaths’ group.

The Obama administration and congressional advocates, along with many academics, believe that this panel would do a better job than Congress at fairly managing the details of Medicare’s payment policies.

Dubbed “MedPAC on steroids,” the proposal is based on an entity called the Medicare Payment Advisory Commission that currently makes nonbinding recommendations to Congress.

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“At this point, I am confident that both the House and the Senate bills will contain what we’ve been calling MedPAC on steroids,” Obama said in an interview with The Washington Post on Wednesday. “I think we’re going to see consensus around the MedPAC proposal.”

Big-money lobbying organizations and corporations are not the only ones on K Street worried about the commission. Though most of the centrist Blue Dog Democrats pushing for the proposal represent rural districts, rural providers are particularly concerned.

“Many of our members are raising those same concerns,” said Maggie Elehwany, vice president of government affairs for the National Rural Health Association.

Under the administration’s proposal, the commission would issue two sets of recommendations every year that the president would have to approve. After that, Congress would have 30 days to vote to stop them or they would take effect.

Obama, Orszag and other senior White House aides have been publicly and privately pushing the idea for months, as have lawmakers such as Sen. Jay Rockefeller (D-W.Va.), but only recently have senior congressional Democrats begun to take the proposal seriously.

Driven in part by a revolt among Blue Dogs, House Democratic leaders are striving to add measures that would reduce future cost growth in the healthcare system.

But the House is not likely to go as far as Obama wants. “We want to do it in a way that respects the prerogatives of Congress,” Pelosi said.

Under the preliminary discussions taking place in the House, the commission would be responsible for making recommendations but Congress would have input during the process, not only at the end, said Rep. Chris Van Hollen (D-Md.), assistant to the Speaker.