Why Did The Administration Retreat On Advance Directives?

JIM HUFFORD

Originally published 1/17/11 on Organon

Just days after taking effect on Jan. 1, 2011, new Medicare regulations authorizing reimbursement to physicians for end-of-life care planning were retracted by the administration. Austin Frakt, pleading for someone to explain the “Medicare end-of-life planning flip-flop,” asks: “Did the Administration follow proper procedure or not?” The stated reason for the retraction was that the rule had been adopted without sufficient notice or opportunity to comment on the issue. I think the legal question, now moot of course, was a close call, but the administration was right to retract. There’s a fairly strong case that notice was inadequate and, therefore, that the rule was procedurally defective.

Background

During the debate leading up to passage of the Affordable Care Act (ACA), a proposal for Medicare to cover end-of-life care planning became a lightning rod for conservative opposition, which branded the proposal as the first step on the road to death panels. The provision was dropped, and the ACA as finally enacted on March 23, 2010 (and amended March 30) did not include Medicare coverage of EOL planning.

On July 13, 2010, the Centers for Medicare and Medicaid Services (CMS) published a Notice of Proposed Rulemaking in the Federal Register (75 FR 40246 [pdf]), announcing its intent to promulgate a new Medicare physician fee schedule implementing, among other things, Annual Wellness Visits established by the ACA. The Notice included the text of the proposed rules and invited public comments on them. There was no mention of reimbursement for advance-care planning in the Notice, and it was not included in the Proposed Rule.

In the ensuing comment period, health professionals urged CMS to include payment for voluntary advance-care planning as part of Medicare’s new Annual Wellness Visits. CMS agreed. Citing evidence that advance planning yields improvements in the quality of EOL care and that patients would welcome the opportunity to discuss such plans with their doctor, the agency incorporated payments for voluntary advance-care planning into its Final Rule, published Nov. 29, 2010 (75 FR 73170).

The provision went largely unnoticed in the media until reported by Robert Pear in the NYT on Dec. 25. Controversy then started brewing, and detractors and supporters alike criticized the administration for trying to slip the provision into the regs on the sly in spite of its notorious failure to pass Congress. The Final Rule took effect Jan. 1, 2011. Its repeal was announced just days later, effective Jan. 10, 2011 (76 FR 1366 [pdf]).

Discussion

The rulemaking process is governed by §553 of the Administrative Procedure Act, which requires federal agencies to provide notice of proposed rulemaking and an opportunity for interested persons to submit written comments. The agency must address major issues raised by commenters and explain its decisions in a “concise general statement” published with its final rule, 30 days before the rule takes effect.

There is no hard-and-fast, bright-line standard as to what constitutes adequate notice. But the purpose of the notice requirement is clear enough: to give “interested persons” (stakeholders, the public) an opportunity to participate in the process. Typically notice is given—as it was by CMS in this instance on July 13—by publishing an invitation to comment along with the full text of a proposed rule in the Federal Register. The agency may of course decide to change the proposed rule in response to public comments. But if it modifies the proposed rule, it must consider whether stakeholders had adequate notice of the final, modified rule.

The answer to that depends on how substantially the rule is changed. Courts considering such cases have invoked various “tests” to gauge the adequacy of notice: whether the final rule is a “logical outgrowth” of the proposed rule; whether the final rule “substantially departs” from the terms of the proposed rule; whether the notice was misleading with respect to the changes incorporated in the final rule.¹ At an abstract level, the inquiry here is about the fairness of the process. If the court is persuaded that, all things considered, the rule’s challengers should have anticipated the changes, then it will likely find notice adequate.

So, should opponents of Medicare coverage for EOL planning have anticipated that CMS would include such coverage in its Final Rule? Well, there are arguments in both directions. You might argue: No. There was no mention of advance-care or end-of-life care planning in the Proposed Rule, and a similar proposal was conspicuously removed by Congress from the ACA itself. And so, even if it is within CMS’ substantive authority to adopt a rule covering advance-planning payments, it would not be fair or reasonable to expect all stakeholders to have anticipated that such a rule would be adopted without further opportunity for public comment.

Or you could argue: Yes. The terms of the Final Rule should have been anticipated and were indeed a “logical outgrowth” of the Proposed Rule covering preventive services in the Annual Wellness Visit. For one thing, Medicare already covers such voluntary advance-care planning as part of the “Welcome to Medicare” physical exam. Other similarities between the two visits should have alerted interested parties to the possibility that advance planning would be incorporated into the new rules.

So, it’s debatable whether CMS’ rule was procedurally defective. But under the circumstances, I think retraction was prudent. The rule probably would have faced legal challenge, with results uncertain.  By retracting the rule promptly, the administration can face the problem head on (or not), on its own terms. The defect can easily be cured with another round of notice and comment, and there is no reason the rule could not be adopted once more in identical form within a few months. CMS appears to have all the substantive authority it would need to institute the rule.

But, apart from any strategic calculus, there’s also something to be said for making good on our commitments to procedural fairness and openness, commitments which at times must trump the pursuit of substantive policy objectives. Supporters of the policy may be dismayed at the administration for yielding to politics over evidence. I sympathize, to a degree. Particularly with regard to substance, it is distressing to see death-panel nonsense accorded any respect. But the procedural issues raise special concerns. The whole administrative apparatus of government is organized around more or less vague, aspirational objectives. Administrative procedure is also vague and aspirational, but it is the best means we have devised to apply neutral, ex ante constraints on the bureaucracy. It represents our best efforts at ensuring that public policy is informed by evidence and expertise and is responsive to public needs and interests.

Procedural fairness is instrumental to substantive ends, but there are times when it is itself more about politics than evidence. This is one of those times.