The current issue of Health Affairs addresses an important precursor to health care payment reform: the need to change Medicare governance so that the nation’s largest health care payer can make changes without undue political influence.

The article, “Medicare Governance and Provider Payment Policy,” written by Hoangmai Pham and Paul Ginsburg from the Center for Studying Health System Change and Mathematica’s James Verdier points out:

It is… appropriate for political debate to drive major policy directions in Medicare—such as when hospital prospective payment replaced cost reimbursement. But constituencies such as particular subgroups of hospitals can exert disproportionate influence, in turn spurring detailed legislation or rule making that is inconsistent with broader policy goals. Whether through Congress, the White House, or directly through lobbying CMS staff, such activity can undermine the integrity, equity, and predictability that new and complex payment reforms require to garner buy-in from stakeholders and work effectively.

The authors consider two options for changing Medicare governance:

  • creation of a new Medicare payment policy board
  • elevating Centers for Medicare & Medicaid Services to Cabinet status and requiring the Medicare Payment Advisory Commission to analyze “the implications for costs, access, and quality of any legislation directly affecting Medicare payment policy that is reported from committees of either House, just as the CBO provides budget cost estimates on spending legislation”

Both ideas are worth exploring, and the time is now.