HHS Policy Shift Limits Public Comment on Proposed Rules from 2025
TL/DR –
The U.S. Department of Health and Human Services (HHS) has issued a statement limiting the situations in which its agencies must publish proposed rules for public feedback before finalizing them, instead directing them to waive this step for rulemaking on grants, benefits, or contracts, along with other specified areas. The policy also expands the “good cause” exemption, which allows agencies to bypass notice and comment in certain circumstances. It is anticipated this will increase the number of final form rules published without a preceding proposal and public comment opportunity; while the full implications of this change remain uncertain, it may limit the public’s ability to formally provide input on policy changes.
Summary of the New Policy
On February 28, 2025, the U.S. Department of Health and Human Services (HHS) announced a policy change. This new policy limits situations where HHS agencies need to publish proposed rules for public input before finalizing them. The new direction expands the “good cause” exemption and waives notice and comment on rulemaking concerning “grants, benefits, or contracts”.
Significant Changes in the Policy
The Administrative Procedure Act (APA) typically doesn’t require notice-and-comment rulemaking for matters like “public property, loans, grants, benefits, or contracts”. Despite this, HHS historically encouraged public participation in these areas under the Richardson Waiver. However, the new policy grants agencies the discretion to use notice-and-comment procedures at will, unless it is legally required.
The “good cause” exemption, allowing agencies to bypass notice and comment for reasons like impracticability or public interest, is also expanded. Previously, HHS used this exemption sparingly, but now, it can be applied more broadly in appropriate situations.
Predicted Consequences
The new policy aims to reduce costs and increase efficiency for HHS and the public, and offers greater flexibility to respond to legal and policy changes. The policy will likely lead to an increase in rules published without first soliciting public comments for the proposed rule.
Implications suggest that HHS intends to modify federal health benefit programs, like Medicaid, without going through the traditional rule-making process. Also, the policy change may impact the National Institutes of Health (NIH) grants.
Specific Agencies Unlikely to be Affected
The U.S. Food and Drug Administration (FDA) and Medicare regulation will likely not be directly affected. FDA’s actions typically do not fall under the stated exceptions for the policy change, but it might adopt the expanded “good cause” exemption. Medicare regulation has its own rulemaking standard that requires public notice and comment under the Social Security Act‘s Section 1871.
Legal Challenges and Stakeholder Impact
Despite the new policy, parties affected by a rule finalized without public comment can challenge it legally on grounds of not qualifying for an exception or issues with the agency’s reasoning or authority. The full impact of the procedural shift remains uncertain, but it can limit stakeholders’ ability to provide formal input on policy changes, requiring them to act quickly when new rules are released.
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