December 4, 2020
VIA ELECTRONIC SUBMISSION
The Hon. Alex Azar, Secretary
U.S. Department of Health and Human Services
200 Independence Avenue SW
Washington, DC 20201
Re: Docket No. HHS–OS– 2020–0012: Securing Updated and Necessary Statutory Evaluations Timely (SUNSET) Rule (RIN 0991–AC24)
Dear Secretary Azar:
The Center for Medicare Advocacy (the Center) is pleased to submit comments in response to the Department of Health and Human Services’ (HHS) Proposed Rule: “Securing Updated and Necessary Statutory Evaluations Timely” (SUNSET) Rule (RIN 0991–AC24; Docket No. HHS–OS– 2020–0012), hereinafter referred to as the “Regulations Rule.”
The Center, founded in 1986, is a national, non-partisan education and advocacy organization that works to ensure fair access to Medicare and to quality healthcare. At the Center, we educate older people and people with disabilities to help secure fair access to necessary health care services. We draw upon our direct experience with thousands of individuals to educate policy makers about how their decisions affect the lives of real people. Additionally, we provide legal assistance to ensure people receive the Medicare coverage to which they are legally entitled, and the quality health care they need.
The proposed rule would retroactively impose an expiration provision on most HHS regulations, and establish “assessment” and “review” procedures to determine which, if any, regulations should be retained or revised. The Regulations Rule is an ill-conceived proposal that would create tremendous administrative burden for HHS and would wreak havoc across a broad swath of Department programs and regulated entities from Medicare and Medicaid and to Food and Drug Administration (FDA) and the Centers for Disease Control and Prevention (CDC). Further, the truncated 30-day comment period for the non-Medicare provisions of the Code of Federal regulations at issue here is insufficient for a rule of this broad scope with potentially harmful effects. The Center strongly opposes this proposed rule and urges HHS to immediately withdraw it.
General Comment – Proposed Rule Focuses on Businesses over Beneficiaries
For the reasons outlined below, the Center for Medicare Advocacy strongly objects to this proposed rule. Among our overall objections is the manner in which the impact of a given regulation is analyzed. While we understand that the agency’s focus on analyzing regulations for “significant economic impact upon a substantial number of small entities” comes from legislative language, it is abundantly clear that the entire analysis of regulations, including that within the discretion and authority of HHS, is geared toward the impact on business – health care providers, health and drug plans, manufacturers and others that profit from the health care system, rather than people who rely on the programs for their health care. This proposed rule seems to stem from a premise that the very existence of a given regulation is a fundamental infringement upon liberty, rather than a potential critical consumer protection, or crucial guidelines of programmatic coverage obligations.
In the preamble to the proposed rule, HHS states that it “believes the benefits of retrospective review, and the need to strongly incentivize it, are so great that the risk of a Regulation inadvertently expiring is outweighed by the benefit of institutionalizing retrospective review in this manner.”[1]
We could not disagree more. Here, HHS is elevating a procedure or process to review regulations over the substance of the regulations themselves. Rather than the proposed rule’s focus on “undue regulatory burdens” on the business of health care, many regulations define and protect the health of those being cared for. Instead of each regulation being a hindrance, a barrier or hurdle to profit-making, many critical regulations in the Medicare, Medicaid and other programs form important infrastructure of these bedrock health care programs. Arbitrary expiration dates for such important consumer protections is an irresponsible and short-sighted approach to the management and oversight of some of our nation’s key benefit programs.
The Proposed Rule Would Wreak Havoc on Medicare and Across HHS Programs
Regulations play a critical role in implementing HHS policies and programs such as Medicare, which provides health coverage for over 62 million people. A strong regulatory framework provides CMS and its contractors the clarity they need to run these programs on a day-to-day basis, gives providers, Medicare Advantage and Part D plans guidance as to their obligations, and explains to beneficiaries what their rights are. The Regulations Rule would create legal uncertainty regarding the validity and enforceability of regulations throughout the review process.
The greater danger posed by the Regulations Rule is that important regulations may be arbitrarily rescinded because there are simply not enough HHS staff or resources to undertake such a sweeping review process. Regulations that do not complete the complicated and time consuming review process would summarily expire, potentially leaving vast, gaping holes in the regulatory framework implementing HHS programs and policies.
Medicare Regulations
Under the proposed rule, regulations must be reviewed 2 years after this rule is effective or 10 years after promulgation, whichever is later; this means that within approximately 2 years, HHS/CMS must review the bulk of keystone Medicare regulations. A cursory review of the promulgation date of key Medicare regulations shows that many would be threatened for termination absent timely review and assessment under the proposed rule since they were first promulgated more than 10 years ago. Under this proposed rule, even if some of these provisions were more recently amended, they would still have to be reviewed within 2 years or they would subject to expiration. This leads to the absurd result that a significant portion – if not the bulk – of Medicare regulations must be reviewed within the truncated time period.
For example, many Medicare provisions in Title 42 would need to be reviewed within 2 years or face extinction, including: various beneficiary and provider appeal rights articulated in Part 405; basic Part A eligibility and entitlement provisions in Part 406; basic Part B enrollment and entitlement provisions in Part 407; provisions that outline the scope of Part A Benefits, including hospital and skilled nursing facility coverage (e.g., §409.33 provides examples of skilled nursing and rehabilitation services and sets the basis for such coverage); Medicare Advantage coverage rules and enrollee protections in Part 422; and important Part D parameters in protections in Part 423.
These critical regulations are not dairy products, produce or some other perishable that have a sell-by date and will inevitably spoil if not consumed; rather, these are core guidelines and protections that form the backbone of Medicare coverage and beneficiary rights. Even if HHS is convinced it can complete at least assessments (if not reviews, if applicable) of these rules within the truncated time period, it is the height of irresponsibility to put an arbitrary expiration date on bedrock rules.
The Medicare program, similar to many other wide-ranging federal programs, relies on various rules to provide a framework of coverage, rights, obligations and other duties required to make the program function. It is challenging enough to ensure that the Medicare program’s myriad documents and forms are adequately updated when there are thought-through, deliberate policy changes. The potential impact of an inadvertently expired regulation due to agency negligence would go beyond just creating a gap in the text of the Code of Federation Regulations. There would be down-stream, cascading ripple effects, impacting a range of sub-regulatory guidance that rely upon a given regulation, that would likely play out over time. The cadre of Medicare policy manuals, guidance documents (such as the Parts C and D Enrollee Grievance, Organization/Coverage Determinations and Appeals Guidance), transmittals, communications to contractors, providers and plans (e.g., Health Plan Management System (HPMS) memos), consumer-directed communications (such as the Medicare Plan Finder and the Medicare & You handbook), forms (e.g. coverage termination and appeal notices) and other miscellaneous types of documentation and communication could be impacted, including rendered void, incomplete (fully or partially) or misleading due to an inadvertently stricken regulation.
The Proposed Rule Would Create Significant Administrative Burden on HHS
HHS asserts that the Regulations Rule would “further democratic values such as accountability, administrative simplification, transparency and performance measurement and evaluation.”[2] In fact, the proposed rule would create a significant, self-imposed administrative burden that would divert resources from critical work, including efforts to address the COVID-19 pandemic. HHS itself estimates that the proposed rule would cost nearly $26 million dollars over 10 years, needing 90 full-time staff positions to undertake the required reviews.[3] Within the first two years, HHS estimates the need to assess at least 12,400 regulations that are over 10 years old.[4] However, these estimates likely underestimate the time and money involved in the review process, and do not accurately account for complications that may arise. Nor do these estimates account for the time that must be spent trying to address inadvertent, yet necessary changes to sub-regulatory guidance resulting from inadvertently expired regulations.
The Regulations Rule would adversely affect HHS’ ability to focus on the administration of current programs, to issue new regulations, and appropriately review current regulations that need modification. In an era of regulatory rollback, and a deliberative effort to exert less oversight of contractors, providers, health and drug plans, HHS envisions tasking more employees with conducting assessments and reviews of regulations that, should they fail to get to them in time, will expire anyway. This amounts to automatic deregulation by design.
Not only would the proposed rule bestow a significant administrative burden on the department itself (in a seemingly self-inflicted wound), it would shift additional burden onto the public, relying upon outside sources to regulate the regulator.
In the preamble to the proposed rule, HHS states that “[t]he Department has considered the risk that a Regulation could expire because the Department inadvertently did not Assess or Review it. The Department proposes to mitigate this risk by allowing members of the public to submit comments requesting that the Department commence the Assessment or Review of a Regulation. If a person is concerned that the Department has not announced the Assessment or Review of a Regulation and the deadline is nearing, the person can remind the Department to conduct the Assessment or Review.”[5] Similarly, HHS asserts that it “anticipates that the public would remind the Department to perform the Assessment or Review if the deadline is nearing and the Department has not yet commenced the Assessment or Review.”[6]
In other words, the agency is relying on the public to save it from itself. HHS plans to ignite a landscape of fuses and rely, in part, on the public to remind the agency to step in and extinguish them should the agency forget or neglect to do so in a timely manner. Providers, plans and other health care business entities likely have the means to better monitor HHS activity, either on their own, through lobbyists, associations or other representatives. They can monitor the regulatory countdown clocks to call the alarm (or refrain from doing so) when a regulation is pending expiration, depending upon their particular pecuniary and other interests. Medicare and Medicaid beneficiaries – while far more numerous – have far fewer individuals or entities that are truly looking out for their benefit without the cloud of pecuniary or other interests, and are more likely to miss an opportunity (or, in this case, an obligation) to speak up for themselves and urge retention of important protections.
If HHS does not have the confidence that it can track per-regulation expiration countdown clocks of their own making, and instead rely on the public to speak out and remind them to intervene in a timely manner, public confidence in the proposed process does not appear to be warranted and is doomed to failure.
The Proposed Rule is Unnecessary and HHS Does Not Have the Authority to Propose Automatic Expiration Dates on Almost All Regulations.
The Regulations Rule claims that automatic expiration dates give HHS the incentive necessary to conduct regular assessments of existing regulations and comply with the Regulatory Flexibility Act (RFA). First, HHS agencies already commonly update regulations when needed. For an example relating to the Medicaid program, in 2002 CMS promulgated new regulations implementing statutory changes to Medicaid managed care.[7] In 2015, CMS published a Notice of Proposed Rulemaking to update and modernize Medicaid managed care regulations.[8] CMS took nearly a year to review and consider the 875 comments submitted, publishing the final rulemaking in May 2016.[9] This administration undertook further rulemaking to revise Medicaid managed care regulations, to “relieve regulatory burdens; support state flexibility and local leadership; and promote transparency, flexibility, and innovation in the delivery of care.”[10] Similar examples can be found relating to the Medicare program. From a consumer advocacy perspective, particularly over the last several years, HHS is not crippled by inertia when influential and powerful stakeholders exert pressure to roll back regulatory “burdens.” HHS’ contention that it needs to “incentivize” regulation review by imposing a mandatory rescission is simply not supported by the facts.[11]
Further, the RFA requires each agency to publish “a plan for the periodic review of the rules issued by the agency which have or will have a significant economic impact upon a substantial number of small entities.”[12] However, nothing in this forty year-old law authorizes agencies to retroactively impose a blanket expiration date to rescind duly promulgated regulations.
In fact, this proposal is contrary to the Administrative Procedure Act’s (APA) requirements for rulemaking. In the APA, Congress established clear procedures and standards for agencies seeking to modify or rescind a rule. The APA requires agencies to go through the same rulemaking process to revise or rescind a rule as they would for a new rule, with public notice and the opportunity to comment.[13] Applying a broad, across the board, automatic expiration date on most or all regulations within its authority is clearly an overreach, a radical example of elevating process over any consideration of substance.
HHS states it has authority under the APA to add end dates, or conditions whereby a previously promulgated rule would expired.[14] We do not dispute that federal agencies can later amend existing regulations. However, the Regulations Rule would modify thousands of separate, distinct rules across HHS in a single stroke, in violation of the APA. HHS’ attempt to apply a blanket amendment to 18,000 regulations violates the APA’s requirements that review of an existing rule take place on an individual basis, requiring specific fact-finding relevant to the individual rule that the agency wants to amend.
Conclusion
The Regulations Rule is simply an attempt to sabotage and destroy duly promulgated regulations, by retroactively imposing on them an arbitrary end date. This rule is unnecessary, will wreak havoc in current HHS programs, including Medicare, and will divert resources from addressing critical issues like the current COVID-19 pandemic.
In the preamble to the proposed rule, HHS notes that it “considered alternatives, including not issuing this proposed rule.” We regret that the agency did not choose this alternative. The Center for Medicare Advocacy strongly opposes this rule, and urges HHS to withdraw it immediately.
We appreciate the opportunity to submit these comments. For additional information, please contact David Lipschutz, Senior Policy Attorney, dlipschutz@MedicareAdvocacy.org at 202-293-5760.
David Lipschutz
Associate Director/Senior Policy Attorney
Licensed in CA and CT
[1] 85 Fed. Reg. 70106.
[2] 85 Fed. Reg. 70104.
[3] 85 Fed. Reg. 70116.
[4] 85 Fed. Reg. 70112. To be specific, HHS states that “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 two years is estimated to be roughly 2,480.” Id.
[5] 85 Fed. Reg. 70110.
[6] 85 Fed. Reg 70109.
[7] CMS, Medicaid Program; Medicaid Managed Care: New Provisions, RIN 0938–AK96, 67 Fed. Reg. 40989 – 41116 (June 14, 2002), https://www.cms.gov/Regulations-and-Guidance/Regulations-and-Policies/QuarterlyProviderUpdates/downloads/cms2104f.pdf.
[8] CMS, Medicaid and Children’s Health Insurance Program (CHIP) Programs; Medicaid Managed Care, CHIP Delivered in Managed Care, Medicaid and CHIP Comprehensive Quality Strategies, and Revisions Related to Third Party Liability; Proposed Rules, RIN 0938–AS25, 80 Fed. Reg. 31098–31296 (June 1, 2015), https://www.federalregister.gov/documents/2015/06/01/2015-12965/medicaid-and-childrens-health-insurance-program-chip-programs-medicaid-managed-care-chip-delivered.
[9] CMS, Medicaid and Children’s Health Insurance Program (CHIP) Programs; Medicaid Managed Care, CHIP Delivered in Managed Care, Medicaid and CHIP Comprehensive Quality Strategies, and Revisions Related to Third Party Liability; Final Rule, RIN 0938–AS25, 80 Fed. Reg. 27498–27901 (May 6, 2016), https://www.federalregister.gov/documents/2016/05/06/2016-09581/medicaid-and-childrens-health-insurance-program-chip-programs-medicaid-managed-care-chip-delivered.
[10] CMS, Medicaid Program; Medicaid and Children’s Health Insurance Program (CHIP) Managed Care (Final Rule), RIN 0938–AT40, 85 Fed. Reg. 72754–72844, 72754 (Nov. 13, 2020), https://www.govinfo.gov/content/pkg/FR-2020-11-13/pdf/2020-24758.pdf.
[11] 85 Fed. Reg. 70099, 70106.
[12] 5 U.S.C. 610(a) (In the case of the RFA, periodically is defined as 10 years, unless such review is not feasible, in which case the review can be extended another 5 years).
[13] 5 U.S.C. § 551(5);see also Maeve P. Carey, Specialist in Government Organization and Management, Can a New Administration Undo a Previous Administration’s Regulations?, Congressional Research Service (Nov. 21, 2016), https://fas.org/sgp/crs/misc/IN10611.pdf (“In short, once a rule has been finalized, a new administration would be required to undergo the rulemaking process to change or repeal all or part of the rule.”); Office of Information and Regulatory Affairs, Office of Management and Budget, The Reg Map 5 (2020) (noting that “agencies seeking to modify or repeal a rule” must follow the same rulemaking process they would under the APA).
[14] 85 Fed. Reg. 70104, fn 85 & 86, citing to separate, specific rulemakings modifying interim final rules implementing mental health parity and foreign quarantine provisions, respectively.