Delivering Better Health and Human Services to Americans

Rachel del Guidice /

Eric Hargan, deputy secretary of the U.S. Department of Health and Human Services, joins The Daily Signal Podcast to discuss the nation’s coronavirus recovery. Hargan also describes his priorities in cutting red tape at HHS, focusing on values-based health care that is primarily about outcomes and not just services, and making health care records more accessible for Americans.

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Rachel del Guidice: I’m joined today on The Daily Signal Podcast by Eric Hargan. He’s a deputy secretary of the Department of Health and Human Services. Secretary Hargan, it’s great to have you on The Daily Signal Podcast.

Eric Hargan: Great to be here.

Del Guidice: Before we launch into our full discussion, just to start off, can you give us a quick update on what’s happening with coronavirus in HHS, how you all are endeavoring to get people back to work, working on diagnostic testing, and everything else that you all are doing?

Hargan: Sure. Well, what we’re doing is a subset about what America’s doing. I mean, we are helping out with backing up states, backing up localities, providing guidance to everyone and leadership on this issue. But a lot of it that’s being done is really being done at the state and local levels, private industry, and really individual Americans who are working on this.

So besides those routine issues of basic hygiene and social distancing, we’ve implemented the largest public health testing system in the world at this point, over 20 million tests and counting, between ourselves and private industry, really, the greatest mobilization we’ve had for production since World War II.

Just recently, we launched Operation Warp Speed, which is an operation, a project here at HHS to work with private industry and several of our other federal counterparts to streamline the development process for vaccines, therapeutics, and diagnostics without compromising safety, to have the first doses of at least the vaccines ready by the end of this year.

So far, the success we’ve had is we’ve really flattened the curve. That was the goal we set for ourselves. Now it’s time to get employees back to work, our children back to school, and our nation reopened.

Now that we’ve prepared the situation between ourselves and the fantastic productive capacity and the ingenuity of the rest of the country, now we’ve flattened the curve and there is going to be probably adequate ability on hospitals to respond to any appearance of the virus.

So now it’s not the health versus the economy. That’s really a false dichotomy at this point. It’s health versus health. It’s getting people back into the hospitals, back into the clinics, back into their doctors’ offices to take care of the things that mostly kill Americans, which is cancer, heart disease, diabetes, COPD, all the things that are the things that day in day out cause trouble for Americans, that are the causes of death for people in fatalities.

We have to get people back to taking care of themselves now that we are on the down slope, God-willing, of this coronavirus.

Del Guidice: Thank you so much, Secretary Hargan, for sharing that update. You’re very passionate about deregulations and cutting red tape and have launched what you call a Regulatory Sprint to Coordinated Care. Can you talk to us a little bit about this initiative?

Hargan: Yeah. Well, as you say, I am very passionate about this area. I came first to HHS as deputy general counsel for regulations, and then as regulatory policy for the department under President [George W.] Bush, when I was at HHS on my first tour of duty. Now I’m the chief regulatory officer and in between I was a professor of administrative law in Chicago. So yes, regulatory initiatives are very close to my heart.

One of the things that I’ve done here is this Regulatory Sprint to Coordinated Care. It’s four different agencies that are revising four different sets of regulations. …

Two of them are about helping unleash information so that providers can share information with patients and with each other, two are about affiliations—how do they deal with each other in affiliation? So how does an independent physician group deal with the hospital or anything like that?

Now it’s called “the sprint” because we want to gather the necessary information and then we move to rule-making as soon as possible. And it’s about coordinating care.

So a lot of these regulations are impeding coordination among providers. They could be delivering lower cost patient care, could be delivering better care, but they’re not because, in many ways, while we in the federal government have been asking them to provide value to patients, to provide value to us, we then have these regulations in place that prohibit them from doing so—in many cases, saying that they might get criminal sanctions, jail time for violating these health care regulations.

That’s very scary, obviously, to providers in the space, to doctors, to hospitals, to nurses. So we’re going to revise these four sets of laws, the Anti-Kickback Statute, HIPAA, the Stark Law—or the physician self-referral statute—and then this thing I won’t repeat again, 42 CFR Part 2. That’s only something for those of us in the regulatory arena to really care about.

But two of those are information statutes, two of them are about affiliations. And fundamentally, we’re trying to enable Americans to get better access to higher quality care at a lower cost.

We think that this regulatory reform, in many cases, it’s been decades since these regulations have been looked at. It’s a complicated process, but it’s something that we’re dedicated to doing and we’re well on our way. So that’s, I think, the great thing.

We’ve issued proposals on three out of the four. I’ve seen the draft proposal on the fourth one. And so, … believe it or not, we’ve been working on these all the way through. A lot of these groups aren’t necessarily front and center on the coronavirus pandemic. So they’ve been able to get a lot of work done on their own. And so watch this space, is what I would say.

Del Guidice: You did throw a lot of things to look out there, but looking big picture, if there’s one regulation that you say has been most harmful, what would that be?

Hargan: In terms of the pandemic or otherwise?

Del Guidice: Otherwise, just across HHS?

Hargan: I would say the thing that we’ve seen the biggest uptick on here is really probably the telehealth and telemedicine restrictions. And I would say that the things that we’ve done in the pandemic to respond, to loosen up constraints on telehealth and telemedicine, are the things that have had the largest impact.

We went the first week of March, we had about 11,000 telehealth beneficiaries in our system. By the end of the first week of April, it was over 650,000 beneficiaries. So, a sixtyfold increase in that area. So I think we’ve seen that those were serious restrictions.

If you had to look systemically, I would say we have laws that are in place—the Stark Law and the Anti-Kickback Statute are very important laws that deal with the integrity of the system that we have.

We have to obey those laws, but the regulations that have developed in those two areas, those are the things that have been the most complicated and I think those are where we’re going to get the biggest bang for the buck to get these regulations.

And they’re twinned with each other at this point, even though they’re two different agencies. We’re working on them at the same time. I think those will have the biggest bang for the buck systemically over time, if we can get those put forward in good order.

Del Guidice: You’ve also been very involved on the data side of things, trying to engage with technology, to remove outdated regulations or regulations that are no longer necessary. How have you gone about doing this?

Hargan: What we did was we took an AI and we’d fed our regulations from HHS into the artificial intelligence as data. And we then instructed the machine, the algorithm, how to read it. So, we had it read through all of our regulations, looking for words that were clues for something that was outdated.

So, for example, if there was a mention of telegrams or telegraph, or if there was a requirement for quadruplicate submission of paper copies to the government, these were examples where we found outdated terms that indicated that we could remove those regulations or alter them.

It flagged things like cross-references that no longer exist or laws that don’t exist anymore. We found places where provisions haven’t been edited for 30 or 40 years. So it filtered our entire code and highlighted those provisions that really needed a closer look.

Then we set our team of our staff to look at them, the people that oversee these regulations, and now they’re consolidating these reforms that were identified through what turns out to be kind of a human-AI partnership for reforming regulations.

But instead of having teams of lawyers working for years to analyze these regulations, we’re just able to feed it into the computer and teach it how to read the relevant parts of the regulations that we [are] interested in. And it was able to produce this in short order, so we could turn to reforming these things.

Del Guidice: When [Alex] Azar joined HHS as secretary, one of the big priorities he has been involved with is advancing values-based care, trying to move the needle, so to speak, so that cares about outcomes and not just services. Can you tell us a little bit about that?

Hargan: Yeah. I mean, this is the third administration in a row to promote value-based care. In other words, we’re trying to move away from what was the elder system, the current dominant system of fee-for-service, to value-based care.

A big part of that is what we just talked about, the Regulatory Sprint to Coordinated Care. That’s to enable there to be more value-based care and get relief from those regulations that keep the elements of the elder system in place somewhat artificially.

So, the president is committed to a health care system of affordable personalized care, and that puts the patient in control. And we think a system that is truly value-based would provide everyone with the affordability that they need, and then the options that they want and the quality they deserve. And we’re proceeding on all of those fronts.

We’re doing a quality reform initiative that I had been leading at the department. We just had the Quality Roadmap that was announced, I think, three weeks ago that we dropped out, that’s going to guide us to the next phase of quality reform.

We’ve got the Regulatory Sprint moving forward. That’s going to enable a lot of the value-based reforms to take place among private sector actors.

And we’ve enabled a lot more options on a number of different fronts, both through the regulatory reforms that we put in place in the middle of the pandemic, and then different things like the interoperability rules, the transparency initiative, the quality initiative, all these things that are focusing on groundwork, really, fundamentals in the health care system that we think are going to drive toward, radiate outward, and really transform the health care system in a way that’s going to be much more patient-focused and much more information-rich for the patients to make decisions for themselves than we’ve had so far in the health care system.

Del Guidice: Speaking of being patient-focused, something else you’ve been working on, I think you may have touched on very briefly, is working on making electronic records available on mobile devices. That’s something that has been keeping you busy as well … on top of everything you have on your plate. So can you tell us how this works and what your vision is for this?

Hargan: This was one of those areas where I was fortunate we were really focused on it in my office. My staff, along with two of our agencies, are really focused on this. And we actually got the final rule out on March 9, which was just at the beginning of the heavy period of dealing with the coronavirus.

I mean, we’re right in the middle of it, but I’m really glad we got these rules out for it to start percolating through industry that now, in these rules put out by the Office of National Coordinator of Health IT and then [the Centers for Medicare and Medicaid Services] had a supplemental rule for this, health care providers are going to be required to provide easy digital access to your records at no additional cost.

So this is going to be available on mobile devices through an app. So you’ll be able to pull all of your health records and your health claims data, no matter which provider they’re from, into a single app for you and for your doctor to use.

Now, we think this is going to be a pretty revolutionary step when everyone has their entire medical record and their claims record in a single place on a single device that’s theirs to have.

And we think that this unleashing of the information will provide competition that’ll allow new business models to develop, that is going to provide novel services, new choices, and also addressing patient privacy concerns.

We had that in mind. That’s always something that comes to an issue. When you have transmission of information, everyone’s always worried, where’s it going? How are you protecting it? We have put in place patient privacy sections of the rule that enable there to be control over these in a way that should protect patient privacy. But that was in mind when we put the rule forward.

This was the fruit of the [21st Century] Cures Act, which is almost 4 years old, that we have gotten the final rule in place now, but it focuses on using apps to get patients access to their health records.

Just to be clear, for people who are concerned about privacy, for any patient data to be shared with an application, the patient must give approval for its release. So we have secure authentication protocols in the final rule.

When the patient wants to use an app to access their health data electronically, the app follows the same process that’s used to access data elsewhere in web portals very commonly.

Also, we’re requiring payers, as part of these rules, to provide educational resources to patients, to inform them about their ability to access their data per these policies and what to look for to responsibly and safely choose an app that they want to use.

Del Guidice: Health and Human Services has been one of the biggest agencies, if not the biggest, in the federal government for cost savings, with having the most cost savings of all the other agencies combined, if I have that right. How have you worked to do this?

Hargan: Well, I’m the chief regulatory officer here at HHS. … My whole background is administrative and regulatory law in the health care space. So, this area is something I’m very, very familiar with.

The big push, though, came from the top down, really from the president, who said repeatedly that deregulation was a priority and that he would be keeping track of deregulation. And that is in fact what has happened.

Now, a point of pride for me is, over the last two years, HHS was the No. 1 Cabinet agency in deregulatory actions. We believe that this is incredibly important.

As everyone knows, the cost of health care has been a flash point for the American public and for everyone in this country for the last many years. So for us to be able to remove burdensome regulations that can drive up costs and get between doctors and patients, which reduces the quality of care, that’s incredibly important.

We’ve been leading on this issue the last two years, but we need to because the cost of health care has been an item of constant impact on American patients. And they have indicated that concern is a top concern of theirs for years and years and years. So we’re addressing it.

From our point of view, we’re addressing it from empowering the health care sector by deregulating these overly burdensome regulations that inadvertently drive up the cost of care through the cost of compliance that aren’t necessary to achieve safety or quality for patients, and in fact sometimes might do the opposite.

But yeah, we have achieved about the amount that the rest of the government has put together and more so in deregulatory savings and actions at HHS.

As I said, that’s a point of pride for me as the chief regulatory officer. I’m glad we’ve been able to do it. Our agencies have been great and have been very forward-leaning in terms of bringing forward deregulatory actions and proposals.

So, we’re focused on that here at HHS and we did even through the pandemic. So, that’s a great thing. But as I said, it’s from leadership on down. The president called that out as one of his serious priorities and he and the White House have kept a close eye on it, and we are happy to comply here at HHS.

Del Guidice: Thank you for sharing that. Something else you’re passionate about is rural health care. I believe you came from a small town and your mom worked at a hospital and played a big role in where you are today. So can you tell us a little bit about your story there and your legacy when it comes to why you’re so passionate to do what you do?

Hargan: Yeah. Well, I grew up underfoot in this rural hospital where my mother worked for 58 years before she retired. And rural health care is something that runs deeply in my family. In fact, five generations deep.

Doc Hargan was a doctor in rural Pulaski County in Illinois in the late 1800s, the same county that I grew up in. He went out in all elements to see his patients, whether by horse and buggy or a rowboat to see his patients. He would row across the Ohio River to his patients in Kentucky to provide them with the care that they needed.

And my family, probably about half of them to this day work in rural health care, whether it’s doctors, nurses, pharmacists, physical therapists, occupational therapists, what have you. But I got to see all this firsthand going on call and everything in my mother’s career.

So, seeing what happens within the hospital, which is now a clinic, a federally qualified health center, in fact, funded by [the Health Resources and Services Administration], one of our agencies here at HHS.

Even when I was born, I don’t remember it, but the fact that we didn’t have an OB unit or a delivery maternity ward in our local hospital, that it had already been downsized to that extent. So, my parents had to drive a long time to Cape Girardeau, Missouri, to another state, to find a place that I could be delivered.

So those experiences from actually the very moment of my birth, whether I remember them or not, really give me a very close firsthand look into the state of health care in rural America. And so that’s why it’s front and center, really close to my heart in what we’re doing here at HHS.

Del Guidice: Thank you so much for sharing that with us. As we wrap up, is there anything else you are working on at HHS that you would like to highlight?

Hargan: Some of the things that we’re going to be working on pretty closely is, obviously, the lessons learned from this pandemic.

I was involved in drafting a pandemic preparedness plan many years ago when I was here under Secretary [Mike] Leavitt in the Bush administration, where we started laying the framework that unfolded in response to this pandemic.

[In 2006] we created what’s now the Assistant Secretary for Preparedness and Response, that agency, and BARDA, which is the [Biomedical Advanced Research and Development Authority], which has been critical in the response that we’ve had—through the Strategic National Stockpile, through all the procurement ability that we’ve been able to have, working with [the Federal Emergency Management Agency].

A lot of those groundwork was laid, the Hospital Preparedness Program, which really hardened our hospitals and made it so that they had trained, they had people on staff. They knew in many cases who they needed to talk to and what they should be doing.

I can see for myself. I came to HHS in the wake of 9/11 and the SARS outbreak. And I could see for myself how emergency response was handled back then when we didn’t have a cadre of people who knew how to do preparedness and response in emergency situations.

If you can imagine, how much better the response has been when you have trained professional staff who this is their job day in, day out to do emergency preparedness, to do emergency response. We were just far better coordinated from the get go. But obviously, as we’ve seen, there are bare patches that are revealed in any emergency situation.

So we’re going to be looking into what worked, what didn’t, what needs to be changed, what doesn’t need to be changed as we move forward. So I say that’s something that’s in hand right now as lessons learned, building on what worked, the foundational work that was done and kept in place, and then trying to see where things didn’t work out as well, and what can be improved of what didn’t work.

Del Guidice: Deputy Secretary Hargan, thank you so much for joining us on The Daily Signal Podcast.

Hargan: Thank you very much.

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