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What the Supreme Court’s Chevron decision means for healthcare
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The Supreme Court’s June 28 decision to strike down the Chevron doctrine will affect healthcare regulations relating to Medicare, Medicaid and even AI, according to experts.
On June 28, in a 6-3 vote, the Supreme Court got rid of the decades-old Chevron doctrine that had been in place since the Reagan administration. The decision was seen as a victory for conservatives and divided the court along ideological lines.
Chevron has shielded many federal regulations from legal challenges. Now, judges will be freer to impose their own readings of the law — giving them broad leeway to strike down regulations on health care, the environment, financial regulation, technology and more. Politician said.
Before Chevron was overturned, federal agencies like the Centers for Medicare and Medicaid Services had the flexibility to amend statutory language based on expert analysis. Now, federal agencies no longer have that flexibility unless the statute is clear.
WHY IS IT IMPORTANT
O decision on Chevronin a case called Loper Bright Enterprises v. Raimondo and its companion case, Relentless v. Dept. of Commerce, has an impact on CMS’s ability to modify or develop the language in the final rules.
The Chevron doctrine allowed agencies like the Department of Health and Human Services and CMS to interpret ambiguities in federal law, creating stability and efficiency for programs like Medicare and Medicaid, according to Cristina Rodriguez, senior counsel at Wolfe Pincavage.
The SCOTUS decision has health experts worried about a potential regulatory crisis, she said in a statement. It could hamper the ability of HHS and CMS to address critical issues, such as regulating rapidly evolving technologies like AI.
It could also derail proposals like drug price negotiations and mental health parity, because CMS relies on its expertise to implement such programs, Rodriguez said. It could threaten programs for low-income patients, like the 340B Drug Discount Program.
The agency could be stuck between having no new policy unless there is a rulemaking statute and not having the ability to build on existing rules, according to Michael Cheek, president and CEO of the SNP Alliance, an association that represents more than 1,300 special needs plans nationwide.
“What we’re doing is thinking about what this means for regulatory action,” Cheek said. “We’re looking at this from a regulatory perspective going forward. The court’s decision may make CMS more cautious about regulations. That will be a decision they make on a case-by-case basis.”
For multiyear regulatory implementations, if CMS questions its own authority, the agency will have to decide whether to pause or move forward, Cheek said.
For example, there is a multi-year provision related to integrated D-SNPs, dual special needs plans. CMS has a plan to make some changes to how these plans are offered.
“This raises a lot of questions and volatility,” Cheek said. “It could impact dual eligibles in integrated plans.”
A KFF Issue Summary examines some of the far-reaching implications for health policy.
“Analysts expect more regulations to be rolled back, erecting a new barrier to implementing essential health care protections, from prescription drug affordability in Medicare, eligibility rules for Medicaid beneficiaries, infectious disease control and public safety standards, as well as consumer protections for people in self-insured private employer-sponsored plans,” KFF said.
The decision does not affect agencies’ ability to enforce health statutes using existing tools, including audits, data collection and agency administrative procedures.
THE BIGGER TREND
Chevron’s decision is already affecting politics.
It is seen as a factor in the health of the Hackensack Meridian processing Health and Human Services Secretary Xavier Becerra on Medicare calculation reimbursement used to determine Disproportionate Participation Hospital payments.
Moody’s Investors Service said the decision diminishes the federal agency’s authority and shifts power to the courts, triggering ripple effects that could have generalized credit effects.
This development has mixed implications for the healthcare industry. Numerous regulations covering reimbursement, insurance eligibility, and many other aspects of the industry directly affect revenue and/or expenses, Moody’s he said.
During oral arguments in the case in January, Supreme Court Justice Elena Kagan cited AI as an arena where courts may be ill-suited to overturn the judgments of agency experts, among other “countless policy issues that this country will face in the years and decades ahead,” according to Political.
“What actions can be taken to address climate change or other environmental challenges? … What rules will constrain the development of AI? In all areas of current or future federal regulation, expect courts from now on to play a commanding role,” Kagan wrote. “It is not a role that Congress gave them. … It is a role that this Court has now claimed for itself, as well as for other justices.”
Brett Kavanaugh, one of the conservative justices who joined the decision, said in January that the doctrine was allowing new administrations to make sharp changes in the way agencies interpret laws, resulting in “extreme instability.”
ON RECORD
“As we described in our amicus brief, on which Justice Kagan relied in her dissent, this rule has long helped ensure that health care laws are interpreted and implemented appropriately. We anticipate that today’s decision will cause significant disruption to publicly funded health insurance programs, the stability of this nation’s health care and food and drug systems, and the health and well-being of the patients and consumers we serve,” said the American Academy of Pediatrics, the American Cancer Society, the American Cancer Society Cancer Action Network, the ALS Association, the American Heart Association, the American Lung Association, the American Public Health Association, the American Thoracic Society, the Bazelon Center for Mental Health Law, the Campaign for Tobacco-Free Kids, the Child Neurology Foundation, the Epilepsy Foundation, the Muscular Dystrophy Association, the National Health Law Program, Physicians for Social Responsibility, the Leukemia & Lymphoma Society, and the Truth Initiative.
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Email the writer: SMorse@himss.org