United Ways of California Issues Public Comment on HHS Proposed Rule

WASHINGTON, Dec. 21 -- Anna Hasselblad, director of public policy at United Ways of California, South Pasadena, 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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United Way of California appreciates the opportunity to comment on the proposed rule change to alter the SUNSET regulation. Under the proposed rule, most of current regulations implementing HHS programs, including all Medicaid and Children's Health Insurance Program (CHIP) regulations, would automatically expire unless they are "assessed" and "reviewed" within certain timeframes. This would impose an enormous administrative burden on HHS in general, and on the Center for Medicare and Medicaid Services (CMS) in particular, that will divert resources unnecessarily from the business of managing and improving Medicaid and CHIP programs (not to mention Medicare and the Marketplaces), especially over the next two years - the period which the agency must review all regulations issued prior to 2012. We are deeply concerned about the impact this rule change will have on families and children.

United Ways of California (UWCA) improves the health, education, and financial sustainability of low-income children and families by enhancing and coordinating the community impact and advocacy work of California's local United Ways. We know we are all better off when our families and neighbors have food on the table, a roof over their heads, and have access to quality health care. But unfortunately, too many families -- including children, seniors, veterans, working families and people with disabilities -- struggle to make ends meet a fact that has only worsened since the onset of the COVID-19 pandemic.

For millions of American families, overwhelmingly working families, wages alone are not enough to put food on the table and pay for other necessities such as rent, utilities, transportation, child care, or health care. We produce a report on the challenges families face in making ends meet all across California, using the Real Cost Measure,/i a basic needs budget approach that estimates the local cost of a decent standard of living in every county and determining the number of households in every neighborhood who earn below that Real Cost Measure. We have found that 1 in 3 households struggle to meet those costs, which is roughly 2 1/2 times the official poverty rate. These struggling households are overwhelmingly working families; 9 in 10 have a working adult in the household. Households with children suffer especially, with those with children under six years of age that fall below the RCM at an astounding 57%, and that rate jumps to 82% for single mothers with children under six. The decisions that have to be made around household finances with this data in mind have serious implications for the proposed SUNSET rule change and the effectiveness of how the department manages the Medicaid and CHIP programs thereby potentially affecting enrollment in these programs for millions of families and children.

The Medicaid and CHIP programs provide health insurance coverage for over 75.5 million people, including 36.6 million children. Running these programs at the federal level requires the use of regulations to give states the guidance they need to operate the programs on a day-today basis, to give participating providers and managed care plans guidance as to their obligations, and to make clear to beneficiaries what their entitlement means. Placing an expiration date on current regulations will force CMS to conduct constant "assessments" and "reviews" even though there has been no change in the underlying Medicaid statutory provisions that those regulations implement, disrupting the administration of the programs at both the federal and state level.

The proposal will force CMS to divert large staff resources to reviewing long-standing regulations, especially over the next two years, preventing it from effectively administering the Medicaid and CHIP programs. It provides that Medicaid and CHIP regulations will expire at the later of: (1) two years after the proposal takes effect, (2) ten years after the regulation was originally promulgated (following notice-and-comment rulemaking procedures), or (3) ten years after the Department "assesses" and, if necessary, "reviews," the regulation. This means that any Medicaid or CHIP regulation issued before 2013 has to be "assessed" and, if necessary, "reviewed" before 2023, or it automatically expires. There are literally thousands of Medicaid and CHIP regulations (as the proposal defines that term) that were issued--properly, with notice-and-comment rulemaking--before 2013. CMS does not have the bandwidth to conduct "assessments" and "reviews" of all these regulations over the next two years and also effectively administering Medicaid and CHIP during a national pandemic.

Further, the proposal will potentially upend long-standing regulatory interpretations of the Medicaid and CHIP statutes, creating uncertainty for states, providers, managed care plans, and beneficiaries about federal policies even though Congress has not changed the underlying statutory provisions. To operate as intended, programs as large and complex as Medicaid and CHIP require predictable rules that states and other stakeholders can understand and rely on. This proposal would subject long-standing regulations to agency "assessment" and "review" under penalty of expiration regardless of whether the statutory provision that the regulations implement have changed. This would have the effect of converting the CMS regulatory process from a tool for providing policy guidance into an engine of uncertainty, which would be particularly damaging to children and families in the case of regulations affecting eligibility and benefits.

Lastly, the Department has no authority to propose automatic expiration of almost all Medicaid and CHIP regulations. The authority for issuing Medicaid and CHIP regulations is found in section 1102 of the Social Security Act, which expressly directs the Secretary of HHS to issue regulations "not inconsistent with this Act, as may be necessary to the efficient administration of the "functions with which [he] is charged under this Act." This section does not give the Secretary the authority to write automatic expiration dates into regulations. Nor does the Regulatory Flexibility Act (RFA), which the Department cites as its authority for this proposal. All that the RFA requires is that agencies have a "plan for the periodic review of rules that have or will have a significant economic impact upon a substantial number of small entities." Conclusion

The department has had a protocol for rule review in place since August 2011 - "Plan for Retrospective Review of Existing Rules." Between January 2012 through February 2016 and the Department regularly reported on its progress in implementing the plan. The latest proposal does not explain why its August 2011 plan does not comply with the RFA's requirement that each agency have a "plan for the periodic review of rules." Nor does it explain why the department stopped reporting on its progress after February 2016. Rather than implement new administrative burdens, we urge the Department to withdraw this proposal and continue to conduct retrospective review of regulations under its 2011 plan.

United Ways of California is committed to preserving enrollment in health care plans for working families and the proposed rule change would only make it more difficult for struggling families. If the proposed rule is adopted, rather than more pressing problems, like the increase in uninsured low-income children in the midst of a pandemic, CMS will be forced to divert resources to "assessing" and "reviewing" most of its long-standing Medicaid and CHIP regulations.

We strongly oppose the proposed rule and request the department withdraw it and instead work with states to help curb the alarming increase in uninsured rates, particularly among children, across the country.

Thank you for your time and consideration.

Very truly yours,

Anna Hasselblad

Director of Public Policy

United Ways of California

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Footnote:

i/ Struggling to Stay Afloat: The Real Cost Measure in California, https://www.unitedwaysca.org/realcost.

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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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