In an effort to address the rapid increase of Medicare costs,
the Medicare Payment Advisory Commission (MedPAC) was established by the Balanced Budget Act in 1997. It is a nonpartisan independent congressional agency that offers Congress guidance on the administration of the Medicare program.
Before 1965 more than half of seniors aged 65 or older had no health insurance coverage,
according to National Bipartisan Commission on the Future of Medicare. The passage of Title 18 of the Social Security Act created Medicare, a federal program to provide health care to seniors. The model for the program was the private employer health plans so that services were covered at a particular rate, premiums were collected, and other plan administration was mirrored by Medicare. The administration of Medicare is the responsibility of the Department of Health and Human Services. To address the alarming costs of Medicare, MedPAC was developed.
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The MedPAC Commission is headed by 17 members appointed for three-year terms which may be renewed,
according to the agency’s website. Commission membership is by appointment and several are appointed each year to avoid a completely new commission at once. Members generally have expertise and experience in finance, economics, health policy and medicine.
MedPAC advises Congress on how to pay providers. It researches and analyzes all aspects of Medicare administration and issues reports regularly to Congress. It evaluates Medicare policies and performance, and presents its findings in regular public meetings and reports. It researches and analyzes various issues regarding Medicare, issues legal briefs and white papers based on its findings, and regularly testifies to Congress regarding Medicare. It also provides information, recommendations and technical support to Congressional committees regarding Medicare administration, research and analyses.
In the course of gathering information for its work, it meets with individuals, members and staff of Congress, health care professionals and advocates of participants, providers and other interested parties. MedPAC issues two reports each year, in March and June, regarding its findings.
MedPAC also gathers contractor reports from outside sources that have particular knowledge, expertise and experience in various areas that affect Medicare administration, provider issues and participant concerns.
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