This US Supreme Court decision is so significant, it rates two reports (at least).
First, from the left-leaning Morning Brew:
https://www.morningbrew.com/daily/stories/2024/06/29/scotus-just-gutted-regulators-power
SCOTUS just gutted regulators’ power
The EPA’s pollution limits, the FDA’s ability to fast-pass “breakthrough” drugs and medical devices, and the FTC’s April ban on noncompetes could all get nixed.
The Supreme Court took a sledgehammer to federal agencies’ powers yesterday in the most historic hobbling since Kathy Bates’s performance in the film Misery.
In a 6–3 decision down conservative/liberal lines, SCOTUS overturned one of the most-cited precedents in American law: the Chevron doctrine, a 40-year-old decision that gave broad power to interpret laws to the federal agencies tasked with regulating everything—from healthcare to net neutrality. Since 1984, it has enabled departments and commissions like the CDC and FCC to determine how vague laws should be implemented in their areas of expertise.
With the precedent gone:
- Courts are no longer required to defer to agencies’ interpretations of unclear laws, which is expected to make it more difficult for agencies—led by subject matter experts appointed by the president and confirmed by the Senate—to regulate the industries they oversee.
- The power to determine how a certain statute should be applied will instead return to judges, who are probably less familiar with the nuances of a subject like factory emissions, for example, than the EPA is.
Chief Justice Roberts stated in the majority opinion that the 17,000 lower court decisions and 70 Supreme Court rulings that have used the Chevron doctrine as precedent will still stand. But federal regulations that aren’t explicitly backed up by clear-cut laws will likely face new legal challenges.
Targets may include: Recent car- and power plant pollution limits set by the EPA, the FDA’s ability to fast-pass “breakthrough” drugs and medical devices, and the FTC’s April ban on noncompetes, according to Bloomberg. In her dissent, Justice Elena Kagan warned that yesterday’s decision could also spell trouble for long-standing agency rules that weren’t or couldn’t be challenged before.
This is a long-sought victory for legal conservatives, who have been aching to curtail the power Chevron gave to unelected bureaucrats (who tend to reflect the ideological beliefs of whoever is president at the time). If Trump returns to the White House, the ruling could also grease the wheels for a big edit-undo on Biden administration policies.—ML
Next, the right of center State Policy Network features a less entertaining but well-sourced title. Their experts summarize this decision's appeal to citizens across the political spectrum.
https://spn.org/articles/chevron-overruled/
Today, the US Supreme Court handed down a decision in Loper Bright Enterprises v. Raimondo that overrules Chevron, a precedent that has enabled federal agencies to craft regulations based on creative readings of Congressional statutes.
The Court rolled back Chevron, which means agencies will now have less power to make regulations without explicit Congressional authorization.
State Policy Network experts responded to this decision below, highlighting what this ruling means for states and communities across the country.
Tony Woodlief, executive vice president at State Policy Network and a senior fellow at the Center for Practical Federalism, noted:
“The Supreme Court’s decision should be welcomed by anyone, regardless of political party, who believes laws ought to be made by elected representatives, and not by secretive and ideologically motivated federal bureaucrats. Chevron has long been used to undermine representative government, so this is an important step towards restoring a government that is truly of, by, and for the people. Now state and local leaders who’ve been hamstrung by one-size-fits-all DC mandates will have authority to craft more suitable and beneficial policies, with greater accountability to voters for the outcomes.”
Steve Johnson, a fellow at the Center for Practical Federalism, added:
“Today’s Supreme Court ruling is a clear victory for those that believe unelected bureaucrats should not have the authority to make law.
More importantly, today’s ruling needs to be a wake-up call to Congress. For far too long, Congress has shirked their responsibilities and conveniently delegated the tough job of legislating to unaccountable DC bureaucrats. Loper Bright is certainly a step in the right direction, but the real question is whether Congress will now step up and fulfill their Constitutional duty.”
Ray Nothstine, a Future of Freedom Fellow and senior editor and writer for State Policy Network, noted:
“One of the main problems with the Chevron doctrine is it tipped the scales in a way that aggressively favors unelected bureaucrats at the expense of the people and their elected representatives. Furthermore, Congress and our courts have ceded way too much legislative and interpretive authority to agencies. Reversing this decision is merely one step in hopefully seeing more authority from Congress and state legislators over the faceless and unaccountable government agencies ruling over us.”
Jennifer Butler, a senior policy advisor at State Policy Network, added:
“The Chevron doctrine undermined democratic accountability by granting unelected bureaucrats significant power to potentially circumvent Congressional legislative intent. It also obscured transparency. Chevron made it difficult for a regular citizen or even state and local governments to challenge agency decisions.
As the media and political pundits consider the implications of this case, supporters of the Chevron doctrine will frame any limitation on deference as a ‘sky is falling’ scenario. But the truth is, one-size-fits-all governance by federal agencies harms individuals, businesses, and communities. Certain regulatory responsibilities that are currently held by the federal government can be effectively managed, and perhaps better managed, at the state level.”
Media interested in interviewing these experts should reach out to Camille Walsh, SPN’s Media Relations Manager, at walsh@spn.org.
Morning Brew published a longform article this week teasing out healthcare implications of Chevron's downfall.
Clipped for length. Bold highlights are mine.
https://www.healthcare-brew.com/stories/2024/07/29/chevron-ruling-healthcare-industry
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The reversal of the doctrine has already come into play in at least one healthcare-related case this month, too. A federal judge in Mississippi ruled that the US Department of Health and Human Services (HHS) can’t enforce a rule banning healthcare providers from discriminating against patients based on gender identity and sexual orientation, citing Chevron’s overturning in his decision.
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Over time, Nighan said she also expects there to be a “significant increase in litigation” around policymaking. Previously, there was hesitancy to legally contest a rule that an agency had issued because it was a hard fight to win under Chevron unless the agency’s interpretation was “completely arbitrary or irrational.”
“That’s not the case anymore,” she said. “If you believe that the agency’s rule or guidance is not keeping with the interpretation of the statute, then there’s an avenue to challenge that in court that is stronger.”
Ultimately, overturning Chevron could shake up how agencies typically do business, and that may cause issues. Agencies may be less inclined to issue regulations and instead focus on more informal rulemaking, like advisory opinions, that are less enforceable than official policies, Long said.
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The ruling could also slow down the policymaking process within agencies that may try to predict which laws could face more legal challenges, and therefore, take more time to nail down regulatory details. Nighan said that the Supreme Court was aware of the potential instability this could bring, but said it would rather have the “correct” interpretation of the law, according to the high court’s majority ruling.
What are some healthcare industry policies that could be challenged in the near future?
There are specific areas experts expect will be more at risk due to this overruling.
As part of the Inflation Reduction Act that Congress passed into law in 2022, Medicare can negotiate drug prices directly with pharmaceutical companies for a select number of drugs. A number of industry players have challenged this law in court, primarily pharmaceutical companies claiming the law is unconstitutional.
Long expects there could be more of that down the road.
Other potential legal battles, she added, could target Section 1557 of the Affordable Care Act, which prohibits certain healthcare programs from discriminating against patients on the basis of race, color, national origin, sex, age, or disability.
In April, HHS issued a rule under the provision to reinstate Obama-era protections that prohibited healthcare providers from discriminating against patients based on gender identity or sexual orientation. But in July, the US District Court for the Southern District of Mississippi ruled that HHS can’t enforce the rule, citing Chevron’s overruling in the court decision.
According to Nicholas Bagley, a law professor at the University of Michigan, the FDA and Centers for Medicare and Medicaid Services have passed a number of rules likely to face legal contestation, such as a proposed FDA rule looking to regulate diagnostic tests developed in hospital and health system laboratories. He said he could see more challenges to these rules post-Chevron.
But he added that he’s not overly concerned about Chevron’s overruling, as the doctrine hasn’t been cited in any Supreme Court cases for roughly a decade. Its overruling doesn’t “change everything,” but intensifies an existing trend of increasing judicial authority over federal agencies, Bagley said. “It will make it very hard for agencies to cut through the red tape and do their jobs. This decision contributes to that—there’s no question,” Bagley said. “But it is not by itself the sole reason for concern.”
Ultimately, though, the effects of Chevron’s overturning won’t be felt immediately in healthcare, Long noted.
“This isn’t going to be something that just happens tomorrow and then it’s going to be over,” she said. “It’s something that will be long, long into the future.”
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