Freezing the Beast: Deregulation and Physician Leaders (Analysis)

The regulatory landscape presents opportunities for physician leaders to promote change that contributes to value — and helps the industry move in a new, free-market direction.

With every new administration comes a new regulatory landscape . It’s such a truism that, most times, it goes without remarks.

Heather Boerner

In the current climate, though, the shift from Obama-era policies to Trump policies is so striking that regulation again is taking center stage in all areas — particularly in health care.

Following a template laid out by the U.S. Chamber of Commerce and other free-market thinkers, the drive toward free market solutions to the country’s health care challenges has accelerated. Government agencies are reconsidering many regulations that affect health care and physician practices — everything from anti-kickback laws to bundled payment models.

It’s a change that President Donald Trump noted in his 2017 joint address to Congress. “We have undertaken a historic effort to massively reduce job-crushing regulations, creating a deregulation task force inside every government agency,” he said, adding that his administration would impose a new rule that “for every one new regulation, two old regulations must be eliminated.”

It’s an approach known in free-market circles as “freezing the beast.” But it’s too simplistic to say we’re in a deregulation state. Instead, as with all administrations, there are some areas that the current White House prefers to regulate, and some it does not.

Recent attempts to pass a right-to-try law at the federal level are perhaps the most potent example of health care deregulation. But it’s not the only one. And as the environment continues to shift, physicians are being called on to help lead their patients and the field into this next era with informed consent.

Health and Safety

In March 2017, the U.S. Chamber of Commerce released its ninth in a series of reports on regulation. This one was on regulations that stymie job creation. It was titled “Taming the Administrative State .” In this report, the chamber gives voice to this idea that Trump touted in his address: the idea of freezing the beast by “mandating the elimination of regulations as new ones are proposed.”

But the report recognizes that all regulations are not created equal. Some protect American health and safety. Others, it says, cost more than $1 billion a year and “transform society.”

It’s the latter that deserve more scrutiny, says William Kovacs, the chamber’s senior vice president for environment, technology and regulatory review, in the report. “Some regulations keep society functioning while others fundamentally transform society,” he says. “By identifying the types of rules needing a more rigorous review of the facts, economics and science supporting them, agencies will be better able to implement the intent of Congress, not the intent of the agency.”

This suspicion of government agencies and the belief that approaches that transform society are detrimental to the economy seem to be core to the current administration, and conflicts with the approach to health care of the previous administration.

Transformation was exactly what the Affordable Care Act aimed to do. But it also aimed to tightly regulate areas of the health care industry that large bills, such as the Health Insurance Portability and Accountability Act did not touch: the individual market.

It also sought to transform the way we pay for health care, creating the Center for Medicare & Medicaid Innovation and pushing forward electronic medical records. Some of these things have increased burnout for physicians, according to a 2018 study published in the Journal of the American Board of Family Medicine.

So it has put physician leaders in an odd position: They have the opportunity to lead changes that contribute to value, and they have the opportunity, now that Obama-era approaches are being rolled back, to lead us in a new, free-market direction.

Opportunities to Influence

The direction the Trump White House is taking regulation isn’t uniformly free-market, however. As with the U.S. Chamber’s report, the Trump administration values some regulations. Others, it’s looking to re-evaluate, with the potential for repeal or scaling back. In many of these, there’s an opportunity for physicians to use their position to influence how regulation will go.

For instance, in March, the Environmental Protection Agency began accepting comments on carbon dioxide emissions limits. In 2015, the Obama administration introduced a Clean Power Plan that slashed emission limits on coal and natural gas power plants. Trump’s White House seeks to impose new limits, but what those might be is still unknown.

In the same month, the Justice Department announced plans to hold successive roundtables to help it “pursue effective and appropriate competition policy and identify related regulatory burdens on the American economy.” These will include antitrust law enforcement, which could affect rules around health care system consolidation and mergers.

What’s more, the Centers for Medicare & Medicaid Services has convened an interagency group to examine the regulations in place to enforce anti-kickback laws. The idea is to look at whether the laws are hindering care coordination or blocking the move to value-based care.

The Other Kind of Regulation

Not every regulatory change, however, is a potential about-face. Indeed, many rules that were put in place under the Obama administration aren’t being stripped — but they aren’t being enforced, either.

For example, late last year, CMS eliminated mandatory bundled-payment models for certain procedures, such as hip fracture and cardiac care, and narrowed the regions in which joint replacement surgeries had to be conducted through bundled payments. Now it’s voluntary.

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And then there are the areas in which the Trump White House seeks to expand regulation. The Bipartisan Health Care Stabilization Act of 2018, which was introduced to Congress, goes back to those individual market health plans the ACA regulated and proposes new regulations. These regulations would make individual health insurance plans that cover abortion ineligible for government funds for reinsurance, high-risk pools and cost-sharing reductions.

And, late last year, the Food and Drug Administration announced it planned to create a new category of cigarettes with less nicotine in them, too. The FDA is taking comments on this idea, and that’s an area where physician expertise could guide policy.

Leading with Informed Consent

Physicians certainly have a role to play in the state house and on Capitol Hill. But as is often the case, physicians can help patients give informed consent — and use those same skills to help legislators make an informed decision about a bill in front of them.

The debate about “right to try” is one such example, says Patricia Zettler, associate professor of law at Georgia State University, adding that it’s a difficult position for physicians.

“It’s an extremely challenging task for a physician” to counsel a patient on right-to-try, she says. “The uncertainty around what the unapproved drug might or might not do when we know so little about it is a concern. A balance needs to be struck between being realistic and not wanting to take away hope from patients.”

The first thing physicians need to help patients understand, say Zettler and bioethicist Allison Bateman-House of New York University, is that “right to try” is a misnomer.

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“It seems to offer a right to something you don’t have a right to,” Bateman-House says of the language used in the bills. “A Supreme Court decision says you don’t have a right. So, for physicians, it’s an issue of talking to patients about trying an investigational drug and going into it knowing that you don’t have a right to it.”

Zettler adds that “it’s not even a right to ask — that already exists.”

Zettler studies regulation and, before entering academia, worked at the FDA. She says that, since the George W. Bush administration, the agency has been working on opening avenues for patients to request investigational drugs. It approves about 99 percent of those requests.

The reasons people don’t get those medications, she says, often have to do with how much medication a drug company has on hand, and drug companies may not want to give access to a drug while they’re still investigating it. The 21st Century Cures Act, passed in 2016, required drug companies to publish their expanded-access policies online. In a recent study, Zettler and colleagues found that compliance is spotty.

“ ‘Right to try’ promotes this idea that, but for the FDA, all these medicines would be available to help patients,” Zettler says. “I just don’t think that’s accurate. The FDA is not the rate-limiting factor in drug development. It’s incredibly difficult to develop a new therapy that works.”

Helping patients understand why they may not have access to a drug is a real service, and connecting them to organizations that can help them navigate the process is a role for physicians.

But it’s not the only role, says Bateman-House, who studies pharmaceutical access. About 38 states already have right-to-try laws, and some of them exclude patients from health insurance for a period of time or ban from hospice and home health care those who use investigational drugs. The right-to-try legislation that Trump signed into law on May 30 doesn’t pre-empt those laws.

She says she’s spoken to leaders of multistate hospital associations whose organizations’ policies limit how many compassionate-use cases they’re willing to treat, in part because of these laws. So physician leaders have a role to play both at the organizational level and the state level, she says.

“As an ethicist, I can’t think of any ethical reasons for these exclusions,” she says. “They are particularly unfair and punitive things. So I would encourage physicians, if they’re comfortable, to lobby to get those exclusions removed.”

Heather Boerner is a freelance health care writer based in Pennsylvania. She covers health law and policy for the Physician Leadership Journal.