Teaching Hospitals of Texas Issues Public Comment on HHS Proposed Rule

WASHINGTON, Dec. 17 -- Maureen Milligan, president and CEO of the Teaching Hospitals of Texas, Austin, 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. 4, 2020, and posted on Dec. 8, 2020:

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Thank you for the opportunity to submit comments on the Department of Health and Human Services Proposed rule, "Securing Updated and Necessary Statutory Evaluations Timely." While we share HHS' goal of reviewing and removing unnecessary regulations, we have strong concerns regarding the proposed rule.

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 proposed rule would create a tremendous administrative burden for HHS and would wreak havoc across a broad swath of Department programs and regulated entities from Medicaid and Medicare to Food and Drug Administration (FDA) and the Centers for Disease Control and Prevention (CDC) and could have a negative impact on safety-net hospitals, which provide care to vulnerable populations. We urge HHS to immediately withdraw this proposed rule.

For background, the Teaching Hospitals of Texas (THOT) is a state association of public and affiliated non-profit hospitals and health systems that share three commitments:

1) Supporting access to care for all in our communities, with a special focus on vulnerable populations;

2) Providing and coordinating essential community health services, such as trauma and disaster management; and

3) Preparing for the future by training tomorrow's healthcare providers and supporting health research and healthcare transformation.

Our members include Texas' large urban public hospitals and health systems, four academic health systems, three children's hospitals and several affiliated non-profit health systems and several more rural hospital districts.

A key part of our collective mission includes providing care to those without insurance; and we do a disproportionate amount of that care in Texas. While our membership from a Texas perspective seems relatively small (16 members) our impact in Texas is significant. For example, just five of our members (in Houston, Dallas, El Paso, Austin and San Antonio) provided nearly $1.3 billion in uncompensated uninsured care costs in 2019.

THOT members had an average of 47% of patients who were uninsured or on Medicaid; with the majority in the 20 percent to 60 percent range.

Our hospitals are essential hospitals, providing services and care that is typically underfunded, but that is critical to our communities and to our state's and nation's health. As a group, our members:

* Provide about 21 percent of Medicaid days in Texas hospitals;

* Provide 30 percent of Medicaid outpatient services;

* Include nearly two-thirds of the state's level one trauma centers;

* Provide about 50 percent of the state's unfunded trauma care;

* Collectively provide nearly two - thirds of the state's GME residency positions, helping to maintain support for GME and to offset unfunded GME costs statewide of more than $400 million.

The proposed rule would create tremendous administrative burden for HHS

HHS asserts that the Regulations Rule will promote "accountability, administrative simplification [and] transparency. . . ."/1

We are concerned however that the proposed rule would create a significant 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./2

Within the first two years, HHS estimates the need to assess at least 12,400 regulations that are over 10 years old./3

However, these estimates likely underestimate the time and money involved in the review process, and do not accurately account for complications that may arise.

The Regulations Rule could adversely affect HHS's ability to focus on the administration of current programs, to issue new regulations, and appropriately review current regulations that need modification. In addition, several regulations implementing important parts of the Affordable Care Act are approaching their ten-year anniversary, like the Medicaid cost-sharing rule. Regulations like these would need to be reviewed within the next two years, or they would expire. However, the underlying law still exists, even if the regulations expire. Without the cost-sharing rule, states would not have clear guidance on how to implement cost-sharing amounts.

If HHS could not dedicate the needed resources to conduct the assessments and reviews, some rules might expire and cause major harm; expiration of Medicaid regulations, for example, could make it hard for states to administer their Medicaid programs, potentially harming millions of people. Especially during crisis situations like COVID-19, it is critically important that HHS have the flexibility and bandwidth to shift focus and respond quickly to immediate needs.

The current rule could negatively affect multiple HHS programs

Regulations play an important role in implementing HHS policies and programs including safety net programs such as Medicaid and the Children's Health Insurance Program (CHIP), which provide health coverage for over 75.5 million people, including 36.6 million children. In Texas, these programs cover over 4 million people including 3.5 million children. A strong regulatory framework provides states the clarity they need to run these programs on a day-to-day basis, gives providers and managed care plans guidance as to their obligations, and explains to beneficiaries what their entitlement means. The Regulations Rule could create legal uncertainty regarding the validity and enforceability of regulations throughout the review process, and if there are not enough HHS staff or resources to undertake such a sweeping review process rules for critical programs could be auto-rescinded.

For example, multiple insurance affordability programs including Medicaid and CHIP rely on regulations at 42 C.F.R. Sec. 435.603 to determine financial eligibility using Modified Adjusted Gross Income (MAGI) methodologies. If this regulation were to simply disappear, programs would be free to redefine MAGI household and income counting rules, with no standards, consistency, or accountability. Arbitrarily rescinding large swaths of regulations would wreak havoc in HHS programs, leading to untold harm to the millions of people who rely on those programs.

In addition, these regulations and sub-regulatory guidance are used to inform states, providers, and managed care plans and beneficiaries about their duties and opportunities. Over the past three and a half years, HHS has used these same communications tools along with section 1115 waivers authorities to transform Medicaid including investments in managed care, directed payment programs, value-based purchasing and quality initiatives. If these Medicaid regulations are rescinded from failure to review many states' Medicaid programs and waivers could be at risk potentially impacting the healthcare safety-net at a time when it is needed now more than ever.

Conclusion

The implementation of this proposed rule would require significant investment of time and resources from HHS--time and resources that otherwise could be spent addressing the pandemic. As noted above, we recommend that the Administration withdraw its current rules, and work with stakeholders to develop an approach that best meets the goals of reducing unnecessary regulations in a more effective and efficient manner.

Thank you for your consideration of these comments. If you have questions, please contact our office.

Sincerely,

Maureen Milligan, Ph.D. M.P. Aff.

President and CEO

The Teaching Hospitals of Texas

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Footnotes:

1/ 85 Fed. Reg. 70104.

2/ 85 Fed. Reg. 70116.

3/ 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.

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

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