President Donald Trump issued an executive order on Friday that solidifies his commitment to deregulate American industry.
The EO lays out a “10 to 1” policy, whereby the administration will nix 10 rules, regulations or guidance documents for every piece of regulation it promulgates. The move is a significant escalation from the deregulatory efforts of the first Trump administration, where the aim was to slash two regulations for every one promulgated.
The entire federal government has undergone a regulatory freeze since the inauguration, and the freeze lasts until March 20. Once the Senate confirms a new secretary for the Department of Health and Human Services, the department can begin laying out items on the chopping block.
Deregulation has always been a priority for Trump. In his first administration he issued a similar executive order with the mandate of cutting regulations two to one; but, it ended up cutting five and a half regulations per rule it put forward, according to the executive order.
"Overregulation stops American entrepreneurship, crushes small business, reduces consumer choice, discourages innovation, and infringes on the liberties of American citizens," the executive order says. "It also contributes to the high cost of living, including by driving up energy prices."
The new deregulation target is nearly double the rate of deregulation in Trump’s prior four years. However, Jeff Davis, health policy director McDermott+ Consulting, said the way the administration defines “rules, regulations and guidance documents” will drastically change the outcome of the EO.
For example, Davis said the Trump administration could define cutting a regulation as carving out a small section of an existing rule without voiding the whole thing.
Like the Patients Over Paperwork initiative during the first Trump administration, the President could cut back on documentation requirements for providers without entirely dismissing the premise of documentation.
“There are a plethora of requirements for providers under the existing Medicare fee-for-service systems that they could look at and try to modify or rescind,” Davis said. “They can't get rid of an entire kind of payment system … but they can dive into some of those specific burdens and requirements within those larger contexts, and try to rescind those or modify those in a way that could be seen as a repeal.”
Trump can only cut back on discretionary rulemaking, Davis said, not the mandatory payment rules like the Medicare Physician Fee Schedule or the Hospital Inpatient Prospective Payment System, which set payment rates for services performed by clinicians.
McDermott+ has already identified a slew of regulations it expects Trump will want to rescind, like former President Joe Biden’s nursing home staffing mandate, the expansion of state-directed payments in Medicaid and the Medicaid/CHIP Expansion Program.
The cuts may show up in mandatory rules for Medicare payment, like the physician fee schedule. If they’re not worked into the series of rules the administration has to put out, HHS will have to issue a new regulation to rescind an existing one.