Katherine HayesThe George Washington University,

SPHHS Department of Health PolicyJuly 9, 2010

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Affordable Care ActBetween date of enactment and September 1,

2019, more than 540 provisions of federal law go into effect.

Three primary implementing agencies: HHS, Labor and Treasury

About 40 instances in which Secretary is required to promulgate rules

Tremendous discretion given to the respective agencies

Subject to Congressional oversight and judicial review

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Agency RulemakingAdministrative Procedure Act 1946 (5 USC

550 et. seq.)Formal rulemakingInformal or “notice and comment” rulemakingNegotiated Rulemaking

General Policy statements – Manuals, directives, communications, letters, etc.

Subject toCongressional OversightJudicial Review

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Formal Rulemaking (almost extinct)Agency employee or ALJ presides over “on-

the-record” hearingWitnesses under oathAgency may issue subpoenasRule on evidenceTakes depositionsOfficial records and preparations of transcriptsDecision must be based on the record (limit ex

parte communications)

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Informal Rulemaking - NoticeNotice - published in Federal Register must

include:Time, place, natureLegal authorityDescription of subject or issueExceptions

interpretive rules general statements of policy, agency organization “good cause”

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*Exception for military, foreign affairs, agency administration

Informal Rulemaking - Comment Comment – interested persons must have

opportunity submit written data, views or arguments. Incorporate general statement of rules and

purposePublication made not less than 30 days prior to

effective dateExceptions:

Substantive rule which grants exemption or relieves a restriction

Interpretive rules or statements of policy “good cause” – must be published within the rule Right to petition for issuance, amendment or repeal

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Negotiated RulemakingNotice and Comment on Committee

FormationApplication, nomination and appointment of

members Agency administrative supportCommittee report – consensus (all), unless

otherwise agreedPublic Record

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Other Agency ToolsExecutive OrdersLetters

Letters to GovernorsState Medicaid Directors

ManualsMedicare provider manualsMedicaid manuals

Policy statementsOther guidance

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Congressional OversightHearingsLetters to Executive and Agency HeadsInvestigations – GAOLegislation

Authorizing legislationAppropriations – “No funds shall be used…”

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Judicial Review of Agency ActionDifficult to overturn agency decision, but not

impossibleChevron v. NRDC, 467 US 837 (1984)

Is there a clear answer provided by law? If so, the agency must follow.

If no clear answer, was agency delegated the authority to make the decision? Generally yes, if the agency has particular expertise.

Is the agency’s interpretation reasonable?

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