Biden's HHS to withdraw controversial Trump-era regulatory reform rule

The U.S. Department of Health and Human Services issued a proposal this week to withdraw a final rule put forth by the Trump administration that would have required the agency to review its regulations once every ten years.  

Members of the public have 60 days to submit comments on the proposal to withdraw the rule.  

The Securing Updated and Necessary Statutory Evaluations Timely, or “SUNSET,” rule had been scheduled to go into effect in March 2021 but was delayed following lawsuits.  

“The SUNSET final rule, if implemented, would significantly alter the operations of HHS with considerable repercussions for a diverse array of stakeholders,” said agency officials in a document published in the Federal Register on Friday.  

WHY IT MATTERS

The SUNSET final rule, released in the last days of Donald Trump’s presidency, mandated that HHS regulations (with some exceptions) be subject to a two-step review.  

If a regulation was not reviewed, it faced potential expiration.  

In its Federal Register filing, Biden’s HHS called the process to put forth the SUNSET rule “extremely unusual, if not unprecedented.”  

As agency officials explained: “The rule is expansive in scope and impact, faced considerable opposition from stakeholders (and very little support), and lacked a public health or welfare rationale for expediting rulemaking.”  

HHS representatives noted that the former administration had completed the rulemaking in less than three months – thanks to what they call “procedural shortcuts” – and that it rested on a “flawed understanding of the resources required for this undertaking.”  

Trump’s HHS made at least two errors in its justification for the rule, HHS officials contend – including underestimating the cost of compliance by at least a factor of four.  And attempting to comply with the rule could make it more difficult for the department to accomplish other priorities, and would be particularly challenging during the ongoing COVID-19 public health emergency, they said.  

The agency noted that Santa Clara County, California – along with several other plaintiffs – filed to overturn the rule in March 2021, leading to the delay of its implementation.   

“Now that we have reconsidered the public comments and the regulatory impact analysis, including a consideration of the impacts that are not quantified or monetized, we believe that the rule prioritized regulatory review over other Department operations to a degree that may negatively impact many stakeholders and the general public in a variety of ways,” said HHS officials.   

“We disagree with that approach as a matter of policy and therefore are proposing to withdraw the rule in its entirety,” they added.  

THE LARGER TREND  

The SUNSET rule was met with consternation from industry groups, including the American Hospital Association.  

“While we appreciate that this process has the potential to alleviate some regulatory burden for our hospital and health system members, we have substantial concerns that it does not provide an adequate mechanism for obtaining public input on the substance of regulations being reviewed,” AHA officials wrote in December 2020.  

Other regulatory changes floated by the Trump administration after his electoral defeat, including modifications to HIPAA, are still being considered.  

ON THE RECORD  

“Upon review, we now believe that the burdens imposed by the SUNSET final rule could undermine the department’s ability to fulfill its public health and human services missions, promote national priorities, and confront the challenges facing the nation,” wrote HHS officials in this week’s Federal Register filing.

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