The Nondelegation Doctrine: The Next Constitutional Showdown (Part 2)
Last week, I explored the potential revival of the nondelegation doctrine through Federal Communication Commission v Consumers’ Research. Today, I want to examine what this could mean for health care regulation by considering the parallels between the 1930s and today.
Does History Repeat Itself? (Definitely)
It was the Great Depression, and it was the worst economic crisis in modern history. Then-President Franklin Roosevelt enacted the New Deal to provide economic relief through domestic programs, public works projects, and financial reforms aimed at economic recovery and strengthening social safety nets.1
Fast forward 90 years, and we see parallels in the large-scale economic packages implemented following the COVID-19 pandemic. Former President Joe Biden introduced the American Rescue Plan and the Infrastructure Investment and Jobs Act to revitalize the economy after widespread job losses and a major global recession. We can also loosely make the connection to the Inflation Reduction Act (IRA), while not a direct result of the pandemic, its intent over a decade is to reduce the federal deficit by an estimated $300 billion.2
The New Deal also propelled a political realignment, shifting Democrats from minority to majority through a Blue Washington and compounded with support from working-class and recent immigrant groups.1
Today, we’re witnessing the end of the progressive era around the world, with voters expressing frustration over economic challenges and shifting their support in elections, most recently with Former President Biden’s loss and Prime Minister Justin Trudeau’s resignation.3
While history doesn’t repeat itself exactly, certain patterns emerge over time—particularly when economic uncertainty fuels broader debates over governance and regulation.
It’s Not Coincidence, We Set This Precedent
Former President Roosevelt’s New Deal set the precedent in 1929 that the government should play a key role in the economic and social affairs of the nation. It established the Social Security Act to provide a system of old-age benefits for workers, a program that is still in operation today.1 This expansion of federal power led to debates over the appropriate scope of government intervention.
Sound familiar?
The nondelegation doctrine is the most recent example in our patterned history; reviving a doctrine from 1935 would remove even more power from federal agencies and is the latest move in our political power struggle.
The Stakes for Health Care Agencies
Let's get specific about what a revived nondelegation doctrine might mean for health care regulation. Consider these examples:
US Food & Drug Administration (FDA) Drug Approval: The Food, Drug, and Cosmetic Act requires drugs to be "safe and effective". But what makes a drug sufficiently safe? How effective must it be? Currently, the FDA makes these determinations through complex risk-benefit analyses. Under a stricter nondelegation doctrine, Congress might need to specify these standards more precisely. But is Congress the appropriate subject matter expert to delineate what should be involved in their analyses?
Medicare Innovation: The Center for Medicare and Medicaid Innovation’s authority to test payment models comes from a broad delegation to implement "innovative payment and service delivery models.” A strengthened nondelegation doctrine might require Congress to specify which types of models are permissible, potentially limiting Medicare's ability to experiment with value-based care.
Public Health Emergency Powers: The COVID-19 pandemic highlighted the breadth of agency emergency powers. Future courts might require Congress to more clearly define what constitutes an "emergency" and what specific actions agencies can take in response.
Medicare and Medicaid: A Complex Web of Delegation
The Medicare and Medicaid programs represent perhaps the most complex delegation challenge. These programs operate through a cascade of authority: from Congress to CMS, from CMS to state agencies, and often from states to private managed care organizations. Each level of delegation could face new scrutiny.
The IRA’s Medicare Drug Price Negotiation Program offers a perfect example of these challenges. While Congress did specify certain criteria for selecting drugs for negotiation (like highest Medicare spending), the law gives significant discretion to CMS in determining "maximum fair prices." The statute directs CMS to consider factors like research and development costs, production costs, and alternative treatments, but leaves the agency considerable latitude in weighing these factors.
Under a stricter nondelegation doctrine, this might be problematic. Would Congress need to specify:
- Exact formulas for calculating maximum fair prices?
- Precise weights for each statutory factor?
- Specific methodologies for analyzing R&D costs?
- Detailed criteria for comparing alternative treatments?
The program's enforcement mechanisms could also face scrutiny. Congress authorized steep penalties for manufacturers who don't participate—up to 95% excise taxes. But it left significant discretion to the US Department of Health and Human Services (HHS) in implementing these penalties. A revived nondelegation doctrine might require Congress to spell out more precise enforcement guidelines. Plus, a new HHS Secretary has entered the chat: Robert F Kennedy Jr was confirmed in a 52-48 Senate vote on February 13 and has suggested he’ll focus on the “regulatory capture”—the idea that the entire regulatory industry needs scrutiny.
Interestingly, a stronger nondelegation doctrine could also open the door for pharma manufacturers; with several lawsuits challenging the program, there may be an argument that federal agencies don’t have the explicit authority.
What’s Ahead
Whatever the Supreme Court decides in FCC v Consumers' Research, health care stakeholders should prepare for a potential shift in regulatory approach. This might mean:
- Engaging more directly with Congress on technical health care issues
- Developing more detailed internal compliance frameworks
- Planning for potentially longer regulatory timelines
- Building flexibility into business models
As dramatic as I can be sometimes, the health care system won't collapse if the nondelegation doctrine returns, but it might need to evolve. After all, if there's one thing health care is good at, it's adapting to change…
Join me every Wednesday as I highlight key court decisions, review notable health policies, and analyze what's behind the bill in health care.
References
1. President Franklin Delano Roosevelt and the New Deal. Library of Congress. Accessed February 18, 2025. https://www.loc.gov/classroom-materials/united-states-history-primary-source-timeline/great-depression-and-world-war-ii-1929-1945/franklin-delano-roosevelt-and-the-new-deal/
2. Inflation Reduction Act. Senate Democrats (2022).
3. Haq Noor S, Chowdhury M. Canada’s PM Justin Trudeau announces resignation. CNN. Published January 7, 2025. Accessed February 18, 2025. https://www.cnn.com/world/live-news/canada-justin-trudeau-resignation-01-06-25/index.html
4. Simmons-Duffin S. RFK Jr confirmed as Trump’s health secretary, over Democrats’ loud objections. NPR. Accessed February 18, 2025. February 13, 2025. https://www.npr.org/sections/shots-health-news/2025/02/13/nx-s1-5294591/rfk-jr-trump-health-human-services-hhs-vaccines
