One Step Forward, Two Steps Back: Regulatory Reform May Be Tougher On CMS Than On FDA
Executive Summary
President-Elect Trump is putting new meaning in the catch phrase “doubling down”: promising an executive order to require agencies to withdraw two old regulations any time they issue a new one. That may be a big challenge for CMS – and also complicate some aspects of FDA’s activities.
FDA’s push to reinvent the OTC monograph process is likely to become much more urgent if the Trump Administration follows through on plans for regulatory reform.
In a YouTube video released Nov. 21, President-Elect Donald Trump repeated a campaign promise to issue an executive order upon taking office “that says for every one new regulation, two old regulations must be eliminated.” He followed that scripted statement with a Trumpian aside, “So important!”
Regulatory clean-ups are a hallmark of new presidential administrations, especially Republican ones. Trump, however, has come up with a catchier version that he first unveiled on the campaign trail, and has now repeated in the first detailed outline of his plans for executive action on taking office. As a practical matter, agencies like FDA may simply generate a list of outdated regulations that can be withdrawn – a typical change of administration activity. The Trump executive order may then argue for doling those lists out two-at-time, rather than simply withdrawing all of them at once.
The good news for FDA (at least in the drug/biologic space) is that regulations are not a dominant activity. In fact, recent legislation like the FDA Safety and Innovation Act and the pending 21st Century Cures bill include numerous deadlines and obligations for FDA to update or issue new policies, but almost always in the form of guidance or other non-regulatory steps.
The agency can thus do most of its ongoing work on prescription drug regulation without weighing whether any given rule is worth the price of withdrawing two older ones.
One glaring exception is in the Over-The-Counter medication space, where the agency is required to follow formal rulemaking procedures to update labeling of most classes of OTC medicine under a process initiated more than 40 years ago. The agency has pushing for a user fee system and/or legislative overhaul to help support more rapid completion of the workload. FDA officials have publicly said that it will take “decades” to complete the process without changes, given the burden of completing formal regulations. (Also see "Rulemaking Process Flawed, But Making Monograph Rules Still Needs Funding" - Pink Sheet, 20 Jun, 2016.)
If FDA is obliged to withdraw two old regulations each time it finalizes a new OTC monograph, that will slow the process even further.
The Centers for Medicare and Medicaid Services may have a much harder time with the Trump regulatory reform plan. CMS uses formal rulemaking to update payments for providers in the Medicare program, and it may be very difficult to find enough old rules to withdraw to support the routine annual updates over time. Of course, any regulatory reform model will have exceptions, and no Administration is likely to want CMS’ provider payment system to grind to a halt.
Trump’s initial agenda is also notable for what it did not include. He did not promise any executive action on the Affordable Care Act – though Congress appears ready to move forward with plans for a legislative repeal as an immediate priority in 2017.
In addition, Trump did not repeat his pledge to implement a hiring freeze on day one. In making the pledge on the campaign trial, Trump included an exemption for “public health” agencies, but still: at a time when FDA is facing a challenging filling vacant positions, a federal hiring freeze would be an unsettling development.
Trump’s video message also included a prominent mention of “developing cures” in the US as an important part of his “America first” vision. That may augur well for the pro-innovation climate at FDA to continue in the new administration.
From the editors of the RPM Report