Wednesday, May 27, 2020

Make 'Temporary' Regulatory Relief Permanent After the Pandemic Passes

By J.D. Tuccille - May 27, 2020 at 10:35AM

Early in the response to the pandemic, localities hard-hit by COVID-19 invited medical professionals working in more fortunate places to temporarily relocate and help treat afflicted patients. To make such moves possible, state governments suspended or loosened licensing requirements that would otherwise delay and discourage doctors, nurses, and others hoping to lend a hand. The Centers for Medicare & Medicaid Services similarly eased restrictions on cross-border practice of medicine, telehealth, testing, and other services. The Food and Drug Administration stepped-down regulation of personal protective equipment and medical devices. Local governments cut all sorts of red tape to make life a bit easier.

Many rules that served as tedious bureaucratic obstructionism in good times were quickly revealed as dangerous and potentially deadly during a crisis and tossed aside. And that's where those rules should remain after the pandemic is gone⁠—on the garbage heap of failed authoritarian policy.

"Sometimes, destruction may create an opportunity for future growth, if the destruction includes the piled-up layers of interest group guano that coats the gears of the system," writes Michael Munger, a professor of political science, economics, and public policy at Duke University. "Our systems of occupational licensing—always a mook's game, but now clearly preventing rapid response to emergencies in other states—drug and medical equipment certification, and regulating employment in the 'gig' economy, have all been shown to be catastrophic. The economic justification for these grants and set-asides was never persuasive. Let's get rid of them!"

Get rid of them, indeed! But how much guano are we talking about?

Isabelle Morales, a communications associate at Americans for Tax Reform, took a crack at adding-up suspended rules and has—so far—come up with well over 500 of them, from federal agencies, state regulators, and local governments. They range from restrictions on medical tests and the production of ventilators to limits on hours driven by truckers and bans on take-out alcoholic beverages.

It's unclear that any of the rules were ever necessary, easy to understand why pushing them aside during an emergency is wise, and difficult to imagine that the world would be a better place if governments inflict them on us once again.

Maybe getting blanket agreement on permanently clearing away all of the red tape is a stretch, but there's widespread agreement that we should sweep lots of rules out of the way.

"We will learn many lessons as a result of this period in history," comments Arizona State University's Stephen Slivinski. "Hopefully one of them will be the benefits of a reduction in the barriers that occupational licensing policies create — not just today in the fight against the coronavirus, but in the future as a means to increase human well-being."

Slivinski, whose work has been quoted by reformers in both the Obama and Trump administrations, has long warned that occupational licensing hampers low-income entrepreneurs and former prisoners seeking honest work. Now he points out that "it is hard to quickly increase the number of doctors or other medical professionals in a state because state laws make it difficult for medical professionals to simply move into and quickly begin to practice—temporarily or otherwise—in a new state."

The solution is to reduce licensing barriers, or else to expand reciprocity so that licenses issued in one state are recognized elsewhere, easing mobility and flexibility in good times and bad. The U.S. Department of Labor agrees, pointing to states that have eased licensing requirements for the pandemic and emphasizing the Trump administration's support for permanent reform.

The Brookings Institution, which also favors occupational licensing reform, suggests that restrictions on telehealth should similarly be retired.

"State and federal barriers in the use of telehealth and AI have served as hindrances to the launch of its full capabilities, particularly those laws that present a patchwork of accepted and non-eligible costs and services," Nicol Turner Lee, Jack Karsten, and Jordan Roberts wrote this month for Brookings. "As Congress is charged with re-evaluating the leniencies permitted to health-care providers during this crisis, federal lawmakers should also see the benefits. The same holds true for states that will need to reconsider lifting boundaries on telehealth services to accelerate its transformational capabilities for patients and doctors."

Temporary federal regulatory relief allows providers like my wife (a pediatrician) to consult with patients via FaceTime and Zoom, get paid for the virtual session, and not then be charged with HIPAA privacy violations. There's no reason that telemedicine shouldn't be a permanent option when it's appropriate.

But if patients do need to be seen in person, they should be able to pick whatever transportation works for getting to clinics and hospitals. As it is, many jurisdictions throw legal obstacles in the way of services like Uber and Lyft transporting patients, picking up medication, and providing other medical-related services. That needs to stop.

"Transportation problems are often cited as a barrier to receiving care and medical compliance," Laura Fraade-Blanar and Christopher Whaley pointed out for RAND Corporation earlier this month. "At least three states removed regulatory barriers to allow rideshares to provide [Non-Emergency Medical Transportation] in the last few weeks." They urge widespread easing of such red tape.

That's only a taste of the rules that need to be cleared away, of course. We should also throw in—at the very least—the regulatory detritus that makes it difficult to manufacture hand sanitizer, or to purchase protective gear, or to drink a beer in the sunshine and fresh air.

"The crisis has been a stress test for American institutions," Patrick McLaughlin, Matthew D. Mitchell, Adam Thierer of the Mercatus Center commented last month. "It has laid bare the outdated, overlapping, and often contradictory morass of rules that make it difficult for public and private organizations to respond to changing circumstances. In many cases, these rules persist not because they protect the public from danger but because they protect organized interest groups from new competition."

After the pandemic passes, government officials will be tempted to return to life-as-usual, restrictive red tape included. But regulatory life-as-usual didn't allow us enough breathing room in good times, it seriously hampered our ability to respond to a health crisis, and it threatens to hobble the economic recovery to come. We may or may not have a cure for COVID-19 anytime soon, but we have a rare opportunity to treat an epidemic of rules and regulations.


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