Updated on: June 22, 2012

HHS Announces Major Overhaul of Regulations to Reduce Costs and Duplication: Preliminary Plan for Retrospective Review of Existing Rules

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Original story posted on: June 1, 2011

mspivey100In recognition of President Barack Obama's executive order to streamline healthcare and reduce costs, the U.S. Department of Health and Human Services (HHS) is undertaking a massive overhaul of its regulations.

 

The announcement by HHS was made on May 26. The department quotes Executive Order 13563, which recognizes the importance of an effective, efficient regulatory framework designed to achieve economic growth, investment flows, job  creation and competition.

The department noted that while sensible regulations can establish clear and transparent frameworks to encourage competition and economic activity, unnecessary and duplicative regulations could damage the market by imposing superfluous costs on the private sector and citizens alike.

 

Retrospective Reviews

 

According to the executive order, the president has directed each executive agency to establish a plan for ongoing retrospective review of existing regulations to identify and eliminate obsolete, unnecessary, burdensome or counterproductive rules - or to modify necessary rules in order to make them more effective, efficient, flexible and streamlined.

 

HHS stated that it is committed to the president's vision of creating an environment where agencies incorporate these retrospective reviews into their regular operations in order to achieve a more streamlined and effective regulatory framework.

 

The objective is to improve the quality of existing regulations consistent with statutory requirements; to streamline procedures for businesses to enter and operate in the marketplace; to maximize net benefits (including benefits that are difficult to quantify); and to reduce costs and other burdens on businesses to comply with regulations.

 

Four Goals for the Retrospective Review

 

The department said that its retrospective review plan has four goals:

 

  • To increase transparency in the retrospective review process;
  • To create more opportunities for public participation;
  • To set retrospective review priorities; and
  • To strengthen analysis of regulatory options.

 

HHS noted that while its systematic review of regulations will focus on the elimination of rules deemed to be no longer justified or necessary, the review also will consider strengthening, complementing or modernizing rules where necessary or appropriate - including, if applicable, creating new rules.

 

The Alignment Initiative

 

Among items under review is The Centers for Medicare & Medicaid Services' Alignment Initiative. This initiative was launched to identify and address conflicting requirements of Medicaid and Medicare, issues that potentially create barriers to high quality, seamless and cost-effective care for dual-eligible beneficiaries.

 

HHS noted that there are "tremendous opportunities for CMS to partner with states, providers, beneficiaries and their caregivers, and other stakeholders to improve access, quality and cost of care for people who depend on these two programs."

 

The goal, according to the department, is to create and implement solutions in line with the CMS three-part aim, which includes provisions to foster improved care for the individual, better health for entire populations and lower costs through operational improvement.

 

As a first step, CMS has asked for public input to help create a foundation for future collaboration to address these issues. It is especially interested in the following:

 

  • Ensuring that dual-eligible individuals are provided full access to Medicare and Medicaid program benefits.

 

  • Simplifying the processes for dual-eligible individuals to access items and services guaranteed under the Medicare and Medicaid programs.

 

  • Eliminating regulatory conflicts between the rules of the Medicare and Medicaid programs.

 



 

  • Improving care continuity and ensuring safe and effective care transitions for dual-eligible beneficiaries.

 

  • Eliminating cost shifting between the Medicare and Medicaid programs and between related healthcare providers.

 

Reconsideration for States

 

Another review CMS will undertake may result in a rule to implement a new reconsideration process for states when CMS disallows federal funds participation - a move that could lengthen the amount of time states have to credit the federal government for uncollected overpayments, revise repayment installment standards and clarify certain interest charges.

 

This regulation, noted HHS, would provide more flexibility and clarification in the redetermination and disallowance processes by implementing statutory requirements giving states additional time to credit the federal government for overpayments or to make technical corrections.

 

Next Steps

 

The department said CMS also has approximately 80 additional reform proposals under review and development. CMS plans to present the proposed reforms to HHS leadership throughout the summer of 2011, according to HHS. These reforms will affect hospitals, physicians, home health agencies, skilled nursing homes, hospices, ambulance providers, clinical laboratories, intermediate care facilities, managed care plans, Medicare Advantage organizations and rural health clinics.

 

While most of these proposals are aimed at reducing barriers to effective patient care, according to HHS, some are aimed at transparency objectives - getting more and better online information to the public so individuals can get the facts they need to make more informed decisions easier and faster. CMS will try to complete these first-phase reforms by the end of the calendar year.

 

In phase two, according to HHS, CMS intends to identify additional reforms for implementation next year. CMS, the department said, will continue to look for ideas from its own staff as well as stakeholders, and will use the opportunity of publishing proposed rules to ask the public to identify additional opportunities for regulatory reform.

 

The cumulative effect of removing so many barriers to efficient and effective patient care will be substantial.

 

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