HHS announces contribution to Obama regulatory reform

The Health and Human Services Department on Tuesday unveiled three Medicare and Medicaid rules in answer to President Obama's call to eliminate regulations seen as unnecessary, obsolete or burdensome. The proposals are designed to free up hospital managers from certain requirements and could save the government as much as $10 billion over five years, HHS Secretary Kathleen Sebelius told reporters during a conference call.

"Medicare and Medicaid rules are there to protect patients," she said. "But in meeting with health care leaders, we have found places where regulations got in the way of the best care."

The rules -- two new proposals and a final one -- would give hospitals and providers more flexibility. For example, they would loosen a current requirement that hospitals assign a single manager for all outpatient services. Such control may have worked in the days when most of hospital care was in-patient, Sebelius said, but with many procedures now done on an out-patient basis, HHS can do away with the unnecessary burden.

Another provision would remove a requirement on rural hospitals that lab work and special services be done in-house, which in the past required hospitals to employ all manner of technicians. They will be able to contract out services. A provision would allow a single governing body to oversee multiple hospitals, and another would permit greater use of nurses and physician assistants in providing care.

The one final rule revises the ambulatory surgical centers' conditions for coverage to allow patient rights information to be provided to the patient, the patient's representative or the patient's surrogate before a surgical procedure.

Donald Berwick, head of Centers for Medicare and Medicaid Services, called the effort part of 21st century regulation that protects health and safety while promoting job creation. "If every federal agency streamlines or repeals unnecessary obsolete regulations," he said, "we can save billions of dollars while changing the focus to be more patient-centered . . . giving providers flexibility to improve patient care."

Cass Sunstein, administrator of the Office of Information and Regulatory Affairs, called the release of the HHS rules a "big day . . . This is not just pie in the sky but finalized rules or proposals for the public to view."

He then updated progress on the Obama administration's broader regulatory look back, which resulted in 500 agency proposals this summer, he said.

"A lot of regulations have not been subject to regulatory scrutiny, and some became obsolete or made sense when they were implemented but circumstances changed," he said. "In some cases, the private sector was already doing the action on its own, or state and local governments were, and some were just excessive."

Sunstein mentioned that just in the past month, the Occupational Health and Safety Administration finalized rules saving 1.9 million annual hours of paperwork. The Environmental Protection Agency exempted the milk industry from regulations treating milk truck spills like oil spills, saving $700 million over five years, he said, and the Transportation Department loosened state and local street sign regulations. "We've just gotten started," Sunstein said.

Republicans in Congress and on the campaign trail have attacked the administration's regulations as heavy-handed, particularly those being implemented under the 2010 health care reform law and the Dodd-Frank financial reform law. But "both the business community and Republicans in Congress are enthusiastic about this look back," Sunstein told reporters. "I've seen the enthusiasm of Republicans and Democrats repeatedly during hearings."

The American Hospital Association applauded the new rules. They provide "much-needed regulatory relief to a health system choked with paperwork," Rich Umbdenstock, AHA's president and chief executive officer, said in a statement. "The proposed new conditions of participation better recognize how care is delivered today. They eliminate unnecessary paperwork, allowing nurses more time at the bedside."

The use of a single government board for multiple hospitals, he added, "can provide comprehensive oversight across their hospitals."

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