Healthcare organizations hope President Barack Obama will fix their worst red-tape problems as part of his promise to get rid of excessive or outdated regulations.
Review seeks to ease burden on businesses
The president gave agencies 120 days from Jan. 18 to submit plans to routinely review regulations they have previously issued, with the goal of finding and eliminating those that “stifle job creation and make our economy less competitive,” Obama explained in a Wall Street Journal op-ed.
It's too soon to know the extent to which the regulation review will affect the myriad existing healthcare-related rules, according to several healthcare organizations, though they welcomed the sentiment.
“Streamlining administrative processes and reducing burdens on physician practices benefits patients and physicians, as physicians are able to devote more time and resources to patient care,” Dr. Ardis Hoven, chair of the American Medical Association's board of trustees, said in a written statement.
America's Health Insurance Plans intends to suggest specific regulations for modification or elimination but could not cite examples last week, said Robert Zirkelbach, the trade group's spokesman. “There are a lot of duplicative regulations throughout our healthcare system.”
An important caveat is that the review will not include regulations issued under the current administration, according to an official at the Office of Management and Budget, because “there's no chance that they are outdated today or inconsistent with the criteria that the president himself laid out.”
The initiative comes after business groups repeatedly blamed Obama's rhetoric and his administration's regulations implementing the Patient Protection and Affordable Care Act and other new laws for stifling recovery from the Great Recession. The uncertain business environment created by those regulations, according to business groups, was to blame for businesses leaving an estimated $2 trillion in cash reserves uninvested.
A growing “tsunami” of red tape issued by the Obama administration, according to an October 2010 analysis of government estimates on the cost of regulations issued by the conservative Heritage Foundation, inevitably has such a stifling effect on economic inactivity. Specifically, the fiscal 2010 cost of new regulations was $26.5 billion, up from the $13 billion cost of regulations issued in the previous fiscal year.
Such findings led Rep. Darrell Issa (R-Calif.), chairman of the House Oversight and Government Reform Committee to request industry groups update him on regulatory burdens they face.
In response, Richard Umbdenstock, president and CEO of the American Hospital Association, wrote Issa on Jan. 14 detailing the ways that conflicting official guidance and regulations have negatively affected hospitals' clinical integration efforts, as well as the “significant increase in administrative burden” caused by the Recovery Audit Contractor program. “Regulatory relief is one of AHA's major legislative priorities this year,” Umbdenstock wrote.
The administration emphasized the regulatory challenge of balancing public safety and negative impacts on businesses. Obama cited “procedures to stop preventable infections in hospitals” as an example of areas where the administration “won't shy away” from attempting to address gaps in regulations. He also pointed to a new streamlined process for approving medical devices to illustrate how the government can improve its approach.
The Food and Drug Administration unveiled changes to the 510(k) program on Jan. 19 that could speed the approval process for some medical devices. The 25-point plan the FDA intends to implement in 2011 includes a streamlined “de novo” review process for certain innovative, lower-risk medical devices.
Less enthusiastic about the regulatory review were some liberal healthcare advocates, such as analysts at the Center on Budget and Policy Priorities, who raised concerns that it would take much-needed time and resources from the creation of extensive new rules needed to implement new laws. Previous time demands already led the administration to miss numerous regulatory deadlines set by the healthcare law.
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