HHS says ‘No thank you’ to accountability

Reviewing old and outdated government regulations as part of a “sunsetting” process is a pragmatic exercise that takes place in a number of Organisation for Economic Co-operation and Development (OECD) countries, as well as about one-third of U.S. states; however, the Department of Health and Human Services (HHS) somewhat ironically claims to have too many old, complex, and lengthy regulations to be able to review them.

In late October, HHS proposed a significant regulation which, if finalized, would walk back a Trump-era rule that was set to require HHS to conduct periodic reviews of its regulations for their impacts on small businesses. The catch is that under Trump’s rule, if HHS doesn’t do a review — which is already required by law — a regulation expires. Nearly 18,000 department regulations would be subject to this new expiration clause.

Legislators often lament an inability to exercise oversight over agencies, and the Trump-era rule sought to provide them some remedy — but now HHS is seeking to evade the requirements that Congress set forth in law. 

Here is the backstory: In 1980, Congress passed a law called the Regulatory Flexibility Act (RFA), with zero dissenting votes and support from then-President Jimmy Carter. The law earned its name because it was intended to create flexibility for small businesses, which — because they lack the expensive attorneys and compliance departments that big businesses have — are known to be disproportionately burdened by regulations.

It sounds crazy, but once regulations are written, they are rarely checked again by regulators to see if they are working.

The RFA created one of the only government-wide requirements on the books for regulations to be assessed after they go into effect, tasking agencies with creating plans to review rules within 10 years for their impacts on small businesses.

The problem is that regulatory agencies have been inconsistent about complying with Congress’s instructions. So, in 1996, Congress amended the RFA to give its provisions more teeth.

Unfortunately, these reforms didn’t work either.

There are still almost no consequences when agencies don’t conduct reviews. As a result, agency compliance has remained spotty, and the regulatory review requirement in the RFA has remained weak.

That’s why there is wide agreement among experts that stronger enforcement mechanisms are needed if the RFA is to succeed, which was precisely the aim of the Trump administration’s “SUNSET” rule: Do the reviews Congress required, or regulations expire.

It may sound dramatic, but it’s actually not. Seventeen states have sunsetting policies for regulations, and about half of OECD countries have some sort of sunsetting arrangement in place.

That brings us back to the present day. In rescinding the SUNSET rule, the Biden administration is arguing that it isn’t needed. HHS acknowledges 85 percent of its older rules have never been updated, but now the agency actually asserts with a straight face that this is evidence the rules “work as intended.”

HHS is claiming, of all things, that it is too resource constrained to evaluate its own rules. Such claims strain credibility from an agency with an annual budget of over $1 trillion and 80,000 employees. Meanwhile, HHS still expects the public to comply with all 18,000 of its existing regulations — or face steep penalties or even imprisonment if they don’t.

Should we be surprised, then, that trust in HHS subagencies like the Centers for Disease Control and Food and Drug Administration is faltering, especially in light of their slow approval of tests and inconsistent communication on vaccines during the pandemic? States like Idaho and Arizona are using the pandemic as an opportunity to review regulations, but HHS is going in the opposite direction.

With the notable exception of the Biden administration, every administration since Jimmy Carter’s has prioritized some form of retrospective review for regulations. If Biden’s HHS doesn’t like the Trump administration’s approach, it should propose its own alternative, not refuse to conduct the reviews Congress mandated.

A recent OECD report ranked the United States just above Latvia and well below the OECD average when it comes to conducting lookback reviews at existing regulations. Actions like HHS’s rescission of the SUNSET rule show why. Numerous countries and states recognize that reviewing regulations is just part of good governance. But not HHS. When it comes to accountability, its answer is an emphatic, “No thank you.”

James Broughel is a senior research fellow with the Mercatus Center at George Mason University.