Obama presents legislation for new Medicare rate-setting agency

President Obama on July 17 sent a draft of legislation to Congress that would establish an Independent Medicare Advisory Council (IMAC), which would have the authority to make recommendations to the President on annual Medicare payment rates as well as other reforms.

In a letter to House Speaker Nancy Pelosi that accompanied the draft legislation, Peter Orszag, director of the Office of Management of Budget, explained that the proposed legislation would "require the President to approve or disapprove each set of the IMAC’s recommendations as a package." If the President approved IMAC's recommendations, Congress would then have 30 days to pass legislation to stop implementation.

The proposed legislation is similar to a bill introduced in the Senate by Sen. Jay Rockefeller (D.-W.V.) that would give rate-setting authority to the existing Medicare Payment Advisory Commission (MedPAC), whose annual reports to Congress contain many suggestions for changes to Medicare spending and financing, but do not carry the force of law.