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Federal Regulatory Burden on Health Care Increased By Over Half in Ten Years



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It is almost impossible to describe how bloated both the House and Senate bills have become. Compare them to the legislation passed in 1965 that created entirely new programs, Medicare and Medicaid: President Johnson signed Public Law 89-97 in July of his first elected term — and it was a mere 137 pages long!

This dramatic different in length motivated me to attempt a similar measurement of the federal regulatory burden on U.S. health care — by counting the pages dedicated to regulating health care in the Code of Federal Regulations (CFR) over the past decade. During most of this period, the federal government preached regulatory restraint. Indeed, the major bill, the Medicare Modernization Act of 2003, was designed to reduce federal control over access to medical care via a privately run Medicare drug benefit and the introduction of Health Savings Accounts.

So, I thought that I would find a decrease, or no change, in the relevant regulatory pages. I focused only on Medicare and Medicaid, regulation of private health insurance, and regulation of providers. However, I did not address the regulation of drugs or medical devices for safety and efficacy.

The result was surprising: Overall, the federal regulatory burden on American health care has increased by more than one-half in the last ten years, as displayed in Table 1.

Table 1: Number of Pages in Code of Federal Regulations Addressing Medical Services & Health Insurance, 1998-1999 to 2008-2009

 

1998-1999

2008-2009

Increase

Medicare & Medicaid

1,811

2,688

48%

Private Health Insurance (e.g. ERISA, COBRA & HIPAA)

96

183

91%

Provider Regulation (e.g. National Practitioner Database, HIPAA)

7

109

1,457%

Total Pages

1,914

2,980

56%

Source: Author’s analysis of Code of Federal Regulations

The greatest regulatory burden, perhaps unsurprisingly, is in Medicare and Medicaid. The October 2008 revision of the CFR included 2,688 pages of the Public Health Code dedicated to the Centers for Medicare & Medicaid Services. The October 1998 version had 1,881 pages: a 48 percent increase.

With respect to private health insurance, there are only 183 pages of regulations: the current Labor Code includes 75 pages of regulations, and the Public Welfare Code also contains 108 pages of regulations on group and individual coverage. This might not look like much, but ten years earlier, the total was only 96: 36 in the Labor Code and 60 in the Public Welfare Code.

The Public Welfare Code contains 109 pages of rules governing providers. This includes rules governing the National Practitioners Database, HIPAA, as well as other administrative regulations. A mere ten years earlier, the number of pages was only seven!

So, even during a period of self-proclaimed regulatory restraint, the government was unable to prevent itself from adding more and more to the regulatory burden of American health care. The current government has the opposite bias, and the regulatory burden will surely accelerate at breakneck speed.

John R. Graham is director of Health Care Studies at the Pacific Research Institute.



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