Legal Council for Health Justice Issues Public Comment on HHS Proposed Rule

WASHINGTON, Dec. 19 -- Caroline Chapman, director of policy, advocacy, and strategic innovation at Legal Council for Health Justice, Chicago, Illinois, has issued a public comment on the Department of Health and Human Services proposed rule entitled "Securing Updated and Necessary Statutory Evaluations Timely". The comment was written on Dec. 3, 2020, and posted on Dec. 8, 2020:

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Legal Council for Health Justice ("Legal Council") writes to oppose the Department of Health and Human Services' (HHS's) proposed rule, "Securing Updated and Necessary Statutory Evaluations Timely" (hereinafter referred to as the "Regulations Rule"). Legal Council is writing in strong opposition to the Regulations Rule because these changes are incompatible with HHS's statutory purpose of providing health and human services to individuals, and will result in costly burdens on federal, state, and local government agencies that administer certain federal public benefits.

At Legal Council, we serve individuals, children, and families living with chronic, disabling, and stigmatizing health conditions. We provide specialized, free legal services in collaboration with health and community providers to maximize access to good health, education, and full human potential. Most of our diverse client population are low-income earners and often live at or below the current poverty line threshold, thus qualifying for critical benefits administered by federal, state, and local government agencies.

Our extensive experience with programs governed by HHS's federal regulations leads us to the conclusion that the Regulations Rule would cause utter confusion among regulated entities. This confusion will be deeply detrimental to the people who depend upon the proper functioning of HHS's regulated entities and programs. We urge HHS to immediately withdraw this proposed rule.

The Regulations Rule Would Create Tremendous Administrative Burden for HHS Programs and Regulated Entities.

Even if the Regulations Rule repeals or allows regulations to expire, the law that the regulations interpret will still exist. Without regulations, however, states and regulated entities will not have clear guidance on how to implement these laws.

It will be a herculean task for states and regulated entities to suddenly begin to interpret the Medicare and Medicaid statutes on their own, and that will be a detriment to the people who rely on HHS programs. Especially during the COVID-19, it is critically important that HHS provide clear and succinct guidance, and maintain enforcement its ability to enforce its regulatory rules and obligations.

Moreover, regulations are integral to the clear and regular implementation of HHS laws, policies, and programs. These programs include safety net programs such as Medicaid and the Children's Health Insurance Program (CHIP). Programs this complex depend heavily upon regulations. Programs this complex, stemming from statutes that are notoriously complicated, require clear regulations. The Regulations Rule would create uncertainty regarding the validity and enforceability of regulations. Repealed or expired regulations would leave gaping holes in the regulatory framework that implement HHS statutes. This will hinder programs operations and cause regulated entities to struggle to make sense of programs and policies.

The Regulations Rules Will Harm People Who Rely On Functioning Safety Net Programs.

The Regulations Rule May Undermine Reasonable Promptness for Medical Assistance and Fair Hearings Obligations.

The Regulations Rule threatens to upend long-settled expectations of the people who rely on safety net programs. The Regulations Rule throws into chaos the regulations that create the foundation for the day-to-day operations of safety net programs under the HHS umbrella. For example, federal law requires that each state's Medicaid state plan "provide that all individuals wishing to make application for medical assistance under the plan shall have opportunity to do so, and that such assistance shall be furnished with reasonable promptness to all eligible individuals." 42 U.S.C. Sec. 1396a(a)(8). It is regulation that provides the 45-day timeliness ceiling to implement that statutory obligation: Determinations of eligibility for Medicaid must be made within 45 days after the application was submitted or within 90 days if eligibility is based on a disability, 42 C.F.R. Sec. 435.912(c)(3), and State plans must "[f]urnish Medicaid promptly to beneficiaries without any delay caused by the agency's administrative procedures." Id. Sec. 435.930(a). Regulations also establish the minimum requirements for the fair hearings states are required to give to applicants whose applications are not acted upon with reasonable promptness. 42 C.F.R. Secs. 431.10(c)(3); 435.1200(b). Federal regulations also provide the contours to the services required under Medicaid Early and Periodic Screening, Diagnostic and Treatment (EPSDT) statutory provisions for children under age 21. 42 C.F.R. Sec. 441.50 et seq.

The Regulations Rule threatens to throw necessary, ingrained regulations like these into doubt, and it will cause turmoil. States may no longer see 45 days as their deadline or even their goal for reasonable promptness for medical services, and may instead permit application processing deadlines, referrals, and hearing timeframes that harm participants, and violate due process.

The Regulations Rule thus threatens to cause significant harm to Medicaid applicants awaiting medical assistance, since they may not be able to pay for their medical needs during the application process. This is a troubling time to make such a change, especially given the demand for critical emergency care caused by COVID-19.

The Regulations Rule Will Hurt Nursing Home Residents.

The Centers for Medicare and Medicaid Services (CMS) regulations require that a state's hearing system for nursing home discharges meet the due process standards set forth in Goldberg v. Kelly, 397 U.S. 254 (1970), as well as other standards specified in the regulations. 42 C.F.R. Sec. 431.205(d). By regulation, the specified minimum standards include the resident's procedural right to examine, before the hearing, all documents and records to be used by the nursing facility at the hearing; bring witnesses; establish all pertinent facts and circumstances; and present an argument without undue interference. Id., Sec. 431.242. Due process demands adequate safeguards for nursing home residents, and HHS regulations provides a clear, well-understood, and national due process floor for nursing home residents across the country which creates predictability and certainty for all.

The Regulations 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). HHS' contention that it needs to "incentivize" regulation review by imposing a mandatory rescission is simply not supported by the facts.

Moreover, 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. Contrary to the APA, the Regulations Rule would modify thousands of separate, distinct rules across HHS in a single stroke, in violation of the APA.

The Regulations Rule is Arbitrary and Capricious

The agency's change is also arbitrary and capricious. It is unclear from the proposed changes whether HHS conferred with other agencies to understand the potential effect of the proposed changes on public aid agencies and other effected agencies' operations. These concerns were not weighed and thus render the Regulations Rule arbitrary and capricious under the Administrative Procedures Act.

Moreover, the exceptions to the Regulations Rule are not clear on the face of the regulation. They do not appear to be listed, and instead the exceptions appear to be described only as "Regulations that legally cannot be rescinded."

At the very least, the public as well as the agencies impacted need more time to understand and adapt to these changes. The Regulations Rule as it stands provides a vanishingly small period of time to work out the repercussions to the public and regulated entities of these changes.

The Regulations Rule Comes At a Devastating Time

Further, this change also comes at a particularly devastating time. Benefits granting agencies need to be focused on getting assistance to Americans in need as quickly as possible, even more so during this COVID-19 pandemic. This reckless rule will end up adding administrative burdens and causing confusion and uncertainty among the federal, state and local benefits granting agencies, nursing homes, and other HHS regulated entities that are already under intense pressure to serve the many Americans in need of essential services.

Conclusion

The Regulations Rule is not necessary, will hurt low-income individuals who rely on safety net programs. Indeed, the Regulations Rule will harm all individuals who rely on the safe and systematic operations of HHS regulated entities like hospitals and nursing homes. We strongly oppose this rule, and urge HHS to withdraw it immediately. Thank you for the opportunity to comment on this important issue.

Respectfully Submitted,

Caroline Chapman

Director of Policy, Advocacy, and Strategic Innovation

Legal Council for Health Justice

17 N. State Street, Suite 900

Chicago, IL 60602

[email protected]

Phone: 312-605-1981

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The proposed rule can be viewed at: https://www.regulations.gov/document?D=HHS-OS-2020-0012-0001

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