AHA Response to OMB Deregulation RFI

May 12, 2025

RE: Request for Information: Deregulation (FR Doc. 2025-06316)

Dear Secretary Kennedy, Administrator Oz and Director Vought:

On behalf of the American Hospital Association’s (AHA) nearly 5,000 member hospitals, health systems and other health care organizations, and our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, we applaud you for seeking recommendations on how to free the health care system from burdensome administrative requirements that prevent Americans from accessing the care they need to live their healthiest lives.

The Trump administration has rightly pointed out that the health status of too many Americans does not reflect the greatness or wealth of our nation. Excessive regulatory and administrative burdens are a key contributor, as they add unnecessary cost to the health care system, reduce patient access to care and stifle innovation. 

For example:

• More than a quarter of all health care spending goes to administrative tasks — topping more than $1 trillion annually.¹ Providers, in particular, face excessive costs to check patients’ eligibility for coverage, bill for payment, and process prior authorizations and appeals of coverage denials.
• Hospitals and health systems spend billions of dollars annually just on collecting and submitting quality measures, with one survey estimating annual per-hospital costs of $3.5 to $12 million.^2,3 The physicians with whom hospitals partner in delivering high-quality care face similarly daunting costs, with physicians in just four specialties — general internal medicine, family medicine, cardiology and orthopedics — spending an estimated $15.4 billion annually on quality measurement.⁴
• Prior authorization requests reached nearly 50 million in 2023 for Medicare Advantage beneficiaries alone, an increase from 42 million in 2022.⁵
• Most claims initially denied by insurers (70%) are ultimately paid, meaning a significant amount of administrative cost is a complete waste.⁶
• The Centers for Medicare & Medicaid Services (CMS) regulations restrict the ability of certain advanced practice providers to independently practice more than is allowable in some states, which are responsible for clinician licensure and scope of practice.

Addressing unnecessary administrative burdens and costs would go a long way to not only lower health system costs but support the accessibility of care. Many hospitals are financially unstable, with nearly 40% operating with negative margins.⁷ This has led to closures of services and even entire hospitals, and the resulting loss in access to care is felt by entire communities.

The AHA, therefore, enthusiastically shares its top 100 ways that the administration could reduce the burden on hospitals and health systems. To put together this list, the AHA collected more than 2,700 ideas from an AHA member survey. Hospitals across the country, along with our Board of Trustees and other member advisors, identified outdated, burdensome, duplicative and expensive regulations that do not improve quality and patient safety and, in some cases, impede hospitals’ ability to offer the highest quality, most efficient care. Many of the items here also would remove administrative complexity to ensure that health care workers spend their time on patients, not paperwork. Some of these suggestions will require partnership with Congress, but many will not. Enacting even half of them would make a real difference throughout the health care system.

Our recommendations are grouped into four categories:

• Billing, Payment and Other Administrative Requirements.
• Quality and Patient Safety.
• Telehealth.
• Workforce.

While the full list is attached, below are the top actions we urge the administration to consider in each area.

BILLING, PAYMENT AND OTHER ADMINISTRATIVE REQUIREMENTS

Research estimates that between 25-30% of all health care spending goes toward administrative tasks, not patient care.⁸ These tasks include verifying patients’ insurance and coverage status, conducting prior authorizations, and acquiring and managing the personnel and technology to comply with different payment models and payer requirements. To reduce billing and payment-related burden, we recommend the following.

Make all Center for Medicare and Medicaid (CMMI) models voluntary, and specifically the Transforming Episode Accountability Model (TEAM) (42 CFR 512.5) and repeal the mandatory Increasing Organ Transplant Access (IOTA) Model (42 CFR 512.412) and the Inpatient Rehabilitation Facility (IRF) Review Choice Demonstration. While we strongly support innovation to improve the quality and accessibility of health care at lower costs, some of the CMMI models, as designed, could have an immediate detrimental impact on the quality of care or on patients’ access to care by overburdening their providers.

The IOTA Model is a complex mandatory payment model that purports to test whether hospital performance-based incentive payments will increase access to kidney transplants; however, these payments are designed to incentivize volume, not quality, and, in doing so, could lead to lower quality transplants and thus a higher risk of failure.

The TEAM would mandate that over 740 acute care hospitals receive bundled payments for five types of surgical episodes, irrespective of whether the hospitals are able to implement the bundles and whether they will improve patient care. The model particularly targets hospitals with low levels of existing experience with alternative payment models, increasing the risk that participating in such a model could financially destabilize them, threatening access to care for everyone in the community.

Finally, under the IRF Review Choice Demonstration, IRFs will have 100% of their Traditional Medicare claims subject to unnecessary and onerous pre- or post-claim review for at least six months. This will add considerable staffing costs to providers who are already struggling under rising input costs and unstable revenue.

Repeal the excessive, confusing and imbalanced provider disincentives included in the June 2024 final rule “21st Century Cures Act: Establishment of Disincentives for Health Care Providers That Have Committed Information Blocking” (RIN 0955-AA05). Under the final rule, hospitals and providers found to engage in information blocking may face reductions in Medicare payment updates, adjustments to reimbursement rates, lower performance scores and potential ineligibility for certain incentive programs. We believe in the importance of making critical health information available to patients, the clinicians treating those patients, and those with appropriate reasons for having access, among which are payment, care oversight and research. However, the disincentive structure in this rule is excessive, so much so that it may threaten the financial viability of economically fragile hospitals, including many small and rural hospitals. In addition, the processes by which the Office of the Inspector General will determine if information blocking has occurred are unclear, including the appeals process, giving this proposed rule the appearance of being arbitrary and capricious.

Standardize more insurance-related administrative transactions, starting with operationalizing the Interoperability and Prior Authorization Final Rule (CMS-0057-F) to establish standard electronic prior authorization processes in Medicare Advantage, the Health Insurance Marketplaces and Medicaid. Hospitals often have hundreds if not thousands of contracts with different insurance plans. Each of these plans include different rules and processes, including the way to communicate requests and share associated documentation with plans (e.g. phone, fax, proprietary portal), the services that are subject to prior authorization, and the clinical criteria a plan will use to adjudicate prior authorization and coverage requests, among other things. There is tremendous opportunity to streamline many of these rules and processes to both improve patient’s access to care while also reducing the costs and burden on providers associated with compliance. For example, prior authorization is frequently applied inappropriately in ways that delay care and harm patients. CMS has taken significant steps to move many health plans towards standardized electronic prior authorization processes. These rules are intended to go into effect in 2026 and 2027, and we urge the administration to ensure robust and timely implementation.

QUALITY AND PATIENT SAFETY

High-quality, safe care is the core of hospitals’ missions. While many regulations originated out of an interest to improve care quality or patient safety, those same regulations, over time, have often become obsolete or redundant. Hospitals and health systems spend billions of dollars annually just on collecting and submitting quality measures, with one survey estimating annual per-hospital costs of $3.5 to $12 million.^9,10 The physicians with whom hospitals partner in delivering high-quality care face similarly daunting costs, with physicians in just four specialties — general internal medicine, family medicine, cardiology and orthopedics — spending an estimated $15.4 billion annually on quality measurement.¹¹ To reduce burdens related to quality measurement and reporting, we recommend the following.

Repeal outdated COVID-19 reporting mandates. As noted above, data reporting is an incredibly time intensive activity that pulls clinicians away from patients and costs a considerable amount in both staff time and technology to complete. While we are deeply committed to ensuring the highest quality care — which requires evaluating performance and acting on the findings — it is imperative that we direct our limited resources to the highest impact areas. Unfortunately, hospitals are subject to significant outdated reporting requirements, in particular with respect to the COVID-19 public health emergency. Eliminating this unnecessary reporting would reduce costs in the health care system and enable providers to spend more time with their patients. Our immediate recommendation is to eliminate the requirements for post-acute care providers to report COVID-19 vaccine rates for patients/residents and staff (86 FR 42489, 86 FR 45446, 86 FR 42396, 88 FR 51009, 88 FR 53233, 88 FR 59250, 88 FR 77767), for hospitals to report staff COVID-19 vaccination rates (86 FR 45382), and for hospitals and skilled nursing facilities to report data on acute respiratory illnesses, including influenza, COVID-19, and RSV, once per week, with more frequent and extensive data reporting required during a public health emergency (42 CFR 482.42(e), 42 CFR 483.90(g), 42 CFR 485.426(e) and 42 CFR 485.640(d)).

Replace the sepsis bundle measure, as required at 79 FR 50241 and 88 FR 59801, with a measure of sepsis outcomes. Hospitals have spent considerable effort — and achieved significant results — in mitigating the incidence and severity of sepsis, saving lives in the process. Unfortunately, research has demonstrated that the sepsis bundle measure has not led to better outcomes yet entails an enormous administrative burden. We encourage the administration to work with hospitals on a measure that will help them further advance the fight against sepsis, while reducing unnecessary burdens in the system.

Eliminate duplicative “look back” validation surveys of accrediting organizations (AOs) at 42 CFR 488.9 and permanently adopt concurrent validation surveys. As part of its oversight process, CMS conducts a full re-survey of hospital compliance with Medicare Conditions of Participation on a representative sample of hospitals each year, comparing each hospital’s results with the most recent accreditation surveys. Instead of fulfilling CMS’ goal of assessing AO performance, the validation surveys result in rework and disruption for hospitals and health systems. CMS should instead permanently adopt concurrent validation surveys that would allow the agency to directly observe AO performance.

Resume conducting low-risk complaint surveys virtually. During the COVID-19 pandemic, CMS adopted a policy in which accrediting organizations and state survey agencies could conduct complaint surveys of low-risk quality issues virtually. Since then, CMS has instructed AOs to conduct most complaint surveys in person, regardless of severity, and hospitals incur costs for each AO visit. Virtual surveys for low-risk complaints would enable more efficient use of survey resources and reduce administrative costs.

Facilitate whole-person care by eliminating 42 CFR Part 2 requirements that hinder care team access to important health information and protect patient privacy under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Despite regulatory changes in the past several years, the regulations in Part 2 are outdated, fail to protect patient privacy and erect sometimes insurmountable barriers to providing coordinated, whole-person care to people with a history of substance use disorder (SUD). Specifically, the regulations require the separation of records pertaining to SUD information, which prevents the integration of behavioral and physical health care because the patient data cannot be used and disclosed like all other health care data.

TELEHEALTH

As technology and consumer preferences have evolved, more care can safely be delivered via telehealth. However, numerous regulations restrict the use of virtual care, impeding innovation and our ability to deliver care more efficiently. While there are numerous ways to expand access to care using telehealth, we recommend starting with the following.

Remove telehealth originating site restrictions within the Medicare program at Sec. 1834(m)(4)(C)(ii)(X) of the Social Security Act (42 U.S.C. 1395m) and 42 CFR 410.78(b)(3) to enable patients to receive telehealth in their homes. Under current rules, patients must be in a clinical site of care, which completely undermines the value of telehealth for patients, limits its adoption and adds costs for providers.

Remove telehealth geographic site restrictions within the Medicare program at Sec. 1834(m)(4)(C)(i) of the Social Security Act (42 U.S.C. 1395m) and 42 CFR 410.78(b)(4) to enable beneficiaries in non-rural areas to have the same access to virtual care as those in rural areas.

Remove the in-person visit requirements for behavioral health telehealth at Sec. 1834(m)(7) of the Social Security Act (42 U.S.C. 1395m) and 42 CFR 410.78(b)(3)(xiv), which is unnecessary, adds a barrier to access and creates a disparity between physical and mental health services.

Remove requirements at Sec. 3132 of the Affordable Care Act (42 U.S.C. 18001 et. seq.) and 42 CFR 418.22(4) that require hospice recertification to be completed in person to allow for hospice recertification to be completed via telehealth. This change would alleviate the burden on patients and their caregivers, as well as on clinicians.

WORKFORCE

The health care system’s greatest asset is our workforce. Unfortunately, doctors, nurses, technicians and others are increasingly burned out and leaving the profession, often citing excessive administrative burden that pulls them away from patient care. We recommend the following.

Streamline care plan documentation requirements at 42 CFR 483.23(b)(4). To provide higher quality, more holistic care, patients are increasingly cared for by interdisciplinary teams. These teams may include a range of clinical professionals, such as nurses, therapists, and social workers. When used, these teams develop what is known as an interdisciplinary care plan. Yet, outdated regulations require nursing-specific care plans. Hence, as more care moves to interdisciplinary teams, clinicians must create duplicate paperwork to document the care plan.

Eliminate the telehealth physician home address reporting requirement, which is currently under waiver as referenced at 89 FR 97110. Without continued waivers or removal, telehealth providers must list their home address on publicly available enrollment and claims forms when performing telehealth services from their homes, compromising their privacy and safety.

Eliminate nurse practitioner and other advanced practice practitioner (APP) limitations at 42 CFR 485.604(a)(2), 42 CFR 485.604(b)(1)-(3), and 42 CFR 485.604(c)(1)-(3). These regulations impose limits on the scope of care APPs may provide that are often more restrictive than under state licensure, despite states having primary responsibility for clinical scope of practice rules. In these cases, hospitals and health systems are constrained in their ability to increase patient access to care through the greater use of APPs.

Remove requirements at 42 CFR 410.61 that require outpatient physical therapy plans of care to be signed off by a physician or non-physician practitioner every 90 days. While CMS made an exception to the treatment plan signature requirement in the calendar year 2025 Physician Fee Schedule for initial care plans where there is a signed referral, the requirement for physicians to sign and date plans of care every 90 days creates an additional administrative burden.

Our attached recommendations also identify ways in which the administration can help reduce burdens caused by private sector stakeholders. While significant consolidation in the insurance industry exists, each insurer can offer thousands of unique health plan configurations, each often with its own rules and processes, such as which services are covered and the clinical criteria used to determine coverage. While we support the innovation and choice that these private entities bring to the health care system, this level of variation creates a tremendous amount of burden on providers. Fortunately, there are actions the administration can take to ease the cost and burden on providers of working with these payers, including addressing insurer consolidation that has given these companies the ability to unilaterally impose considerable burdens on providers.

Thank you for your consideration. We look forward to working with the administration on the much-needed effort to reduce regulatory red tape so that America’s hospitals and health systems can best support the health of their communities. Please contact me if you have questions, or feel free to have a member of your team contact Ashley Thompson, AHA’s senior vice president for policy analysis and development, at (202) 626-2688 or athompson@aha.org.

Sincerely,

/s/

Rick Pollack
President and CEO

Attachment: 100 Ways to Free Hospitals from Wasteful and Burdensome Administrative Requirements to Provide the Highest Quality, Most Efficient Care to Patients 

View the letter and attachment below.