One Obamacare Idea From Which California Could Learn

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What should a government do if costs in key programs keep going up, as if on autopilot, because of formulas?

Get rid of those formulas is probably the best idea. But what if such a big change is impossible in the short term? What then?

California has a version of this problem, with formulas and unanticipated, unpredictable spending. Intriguingly, Obamacare -- the Affordable Care Act now at the center of the news as the U.S. Supreme Court considers its constitutionality -- offers a solution with a familiar California flavor:

A Super Board.

You probably haven't heard of this board -- the Independent Payment Advisory Board. It's gotten little attention as the public and press debate other provisions of Obamacare -- the mandate on individuals to purchase health insurance, and the guarantee that health insurers cover people, regardless of pre-existing conditions.

But the IPAB could be one of the most important pieces of the act, particularly if you worry about out-of-control budgets, as Californians do.

The IPAB is a 15-member commission, appointed by the president, that could step in to slow the growth of Medicare costs, and rising health care costs, if those costs rise above a certain target. That makes it a backstop--a way to check the formulas if they spin too far out of control.

The group is supposed to be full of experts -- doctors, health professionals, financial experts, employers, consumer representatives, etc. -- and insulated from politics somewhat, via six-year terms. The board also has real power -- to step in if health care cost reduction targets aren't met, and to make recommendations that go automatically into effect unless Congress and the president approve bills to modify or overturn them.

If that sounds familiar to Californians following the state's problems, it should. California has a famously large number of commissions that can step in and demand changes -- most notably the coastal commission and the public utilities commission.

And the IPAB is similar to the kind of super-committee that some reformers have suggested as a way to check the out of control government. In particular, the IPAB reminds me of the citizens' council proposed by the Think Long Committee for California late last year; that council had a similar size, and six-year terms for its members. And while not displacing the existing structure, the Citizens' Council would have the ability to step in and make proposals and interventions in the long-term interests of the state.

These sorts of structures are not ideal; the normal procedures of representative democracy make more sense. But California would have to have a new constitution in order to install real representative democracy. Bodies like IPAB make some sense, at least in the near term, as a way to prevent the out-of-control formulas that govern budgets from spinning too far out of control.

Such super-committees are likely to be with us for sometime, no matter what the U.S. Supreme Court does with Obamacare.

Lead Prop Zero blogger Joe Mathews is California editor at Zocalo Public Square, a fellow at Arizona State University’s Center for Social Cohesion, and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (University of California, 2010).

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