Can regulations just disappear? It might happen under a proposed rule announced Wednesday by the Department of Health and Human Services (HHS).
"This is the biggest regulatory reform effort in the biggest regulatory agency," Brian Harrison, HHS chief of staff, said Wednesday on a phone call with reporters. "We're proposing a rule that will require regular review of regulations to ensure that they're up to date and delivering the promised benefits."
Under the proposal, the department will review each of its regulations -- with some exceptions -- every 10 years. Those regulations that are currently more than 10 years old must be reviewed within 2 years of the enactment of the proposed rule; regulations that aren't reviewed during that time will expire, Harrison said.
In other words, any older rules that HHS fails to review during the 2-year window would simply vanish from the Code of Federal Regulations.
Exceptions to the review requirement include regulations that are jointly issued with other agencies, those that legally cannot be rescinded, and those issued with respect to a military or foreign affairs function or addressed solely to internal management or personnel matters.
A 30-day comment period began Wednesday for most of the rule, though a few parts have 60-day periods.
Decades' Worth of Regulations
During the question-and-answer session of the media call, one reporter noted that HHS was founded in 1953. "If this is all the regulations put out by HHS -- that's 67 years' worth of regulations -- if this moves forward the clock starts ticking and you have 2 years to review 67 years' worth of regulations, and if you don't get through them they automatically go away?" she asked. (Actually, it would only affect the last 57 years of regulations, since it doesn't apply to regulations less than 10 years old.)
"That's generally correct, although there are certain exceptions -- but yeah, basically 10 years from promulgation of the [affected] rule or 2 years from promulgation of this [new] rule, whichever is longer," Harrison replied.
Another reporter asked about whether HHS has the authority to sunset regulations wholesale. "We have the existing rulemaking authority as a legal basis for this proposal," he said. Speaking on background, another HHS official added that "this is using existing statutory authorities for our regulations, and the proposal is simply to amend our regulations to add expiration dates if a condition were not to be met. That's a fairly common practice in the government, so we're pretty confident of the legal basis for this."
Little Effect on Outpatient Practices
The rule is not likely to have too much effect on most outpatient physicians' day-to-day practices, said Eric Knickrehm, a healthcare attorney at Ballard Spahr, a law firm here. That's because many of the rules that affect physicians are implementing laws -- such as the Stark self-referral law or Anti-Kickback Statute -- that themselves don't have expiration dates, so the implementing regulations don't expire.
Other regulations affecting doctors, such as the Medicare Physician Fee Schedule annual rule, "would fall outside of this requirement because they're already being reviewed or appended on an annual basis," he said in a phone interview.
Mark Polston, former chief litigation counsel at the Centers for Medicare & Medicaid Services (CMS) and a partner in the healthcare law practice at King & Spalding here, noted that the rule is quite broad. It would include rules on "food safety, drug approval, and healthcare financing," he said.
"I don't think they're saying they would have drug approvals expire if drugs are approved ... but I think what they're saying is that if there is a rule out there that describes what a manufacturer of a drug must do to get FDA approval," that might fall under the review requirement. So you could conceivably have rules about how drugs and devices are approved -- all be subject to this proposed rule, he said.
Some of the healthcare financing rules that might fall under the review requirement could "conceivably be disruptive" to hospitals, Polston said. For example, "hospitals that operate nursing programs or other programs where they educate and train allied health professionals, Medicare by statute is required to pay for costs associated with some of those programs, and there's a regulation by which the secretary implemented that. That regulation has a substantial economic impact on small entities" -- which is required for the rule to be subject to review -- "because small hospitals sometimes have these programs ... Would that rule merely go away if the secretary didn't review its economics impact and if so, what about the income stream for those hospitals that are paid for those services?"
Gail Wilensky, PhD, senior fellow at Project HOPE, said the idea of reviewing old regulations "is certainly a sensible idea, to see whether or not they remain relevant in their current form."
But "whether you can get rid of regulations would depend on whether or not the implementing legislation has changed," said Wilensky, who served as CMS administrator under President George H.W. Bush.
"You can't get rid of regulations willy-nilly if the legislation driving them is still around" without following the Administrative Procedures Act, which requires HHS to issue a Notice of Proposed Rulemaking, allow time for the public to comment on the proposed rule, and address the comments when the final rule is written, she said.
And, Wilensky added, HHS will be reviewing all of these regulations at the same time it is writing regulations for new legislation that's being passed. "It's not like [they can say] 'We won't have any more regulations to write while we go do this.'"
A Tight Timeframe
Both Polston and Knickrehm agreed that the 2-year deadline to review all of the regulations may not be feasible. "I have a suite of regulations that control the Medicare and Medicaid programs; in hard copy it's five or six volumes of regulations, and that's just Medicare and Medicaid," said Polston.
"HHS has many more regulations than that, including FDA. They're really putting themselves on a tight schedule.... That's a very significant amount of work to do in a 2-year time period. It's ironic that a rule that has, probably as its purpose, to reduce a federal bureaucracy is probably creating an additional bureaucracy," he said.
Knickrehm said that 2 years "struck me as a particularly short time period" for the review. "Agencies are already investing quite a few resources in annual rulemaking, particularly at CMS," he said.
In a press release on the rule, HHS said that the rule will not impose undue or impractical burdens on agencies within HHS. "Agencies such as CMS already update significant amounts of regulations each year, including through annual payment rules," the press release states. "The department estimates investing approximately $10-26 million in this effort over 10 years. HHS' annual budget is more than $1 trillion."
In the proposed rule itself, the agency noted, "The department has roughly 18,000 regulations, the vast majority of which it believes would need to be assessed. Roughly 12,400 of these regulations are over 10 years old. The vast majority of these would need to be assessed within 2 years if this proposed rule were finalized. But because the department estimates that roughly five regulations on average are part of the same rulemaking, the number of assessments to perform in the first 2 years is estimated to be roughly 2,480."
The experts differed slightly on what would happen to the rule should former Vice President Biden be elected president. "Democrats have trouble with some regulations as well," said Wilensky. "If [the regulations] were written during a Republican period, they would be only too happy to revisit them and make them tougher."
Polston had a different take. "I think if there is a change in administration, this is one of those things they will pause immediately and want to take a strong look at it" and see whether they would want to move forward with it or withdraw it. "That's not uncommon in a change of administration," he said.
https://www.medpagetoday.com/publichealthpolicy/healthpolicy/89514
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