FEDERAL 

RULEMAKING

Agencies Could Take 

Additional Steps to 

Respond to Public 

Comments

Report to Congressional Requesters

December 2012

GAO-13-21

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-13-21, a report to 

congressional requesters

December 2012

FEDERAL RULEMAKING

Agencies Could Take Additional Steps to Respond to 

Public Comments

Why GAO Did This Study

Agencies publish thousands of rules 

each year, with significant benefits and 

costs. Before issuing a final rule, 

agencies are generally required to 

publish an NPRM in the Federal

Register. Agencies must then respond 

to public comments when issuing final 

rules. Agencies may use exceptions in 

certain circumstances to forgo this 

NPRM process to expedite rulemaking. 

The Office of Management and Budget 

(OMB) has authority to provide 

guidance on regulatory issues. GAO 

was asked to provide information on 

the rulemaking process. This report 

addresses (1) how often agencies 

issued final rules without an NPRM; (2) 

which exceptions agencies used to do 

this; and (3) whether agencies took 

certain actions when issuing major 

rules without an NPRM, including 

voluntarily requesting and responding 

to public comments. GAO reviewed a 

generalizable random sample of 1,338 

final rules published during calendar 

years 2003 through 2010. The sample 

contained rules by 52 agencies, 

including all cabinet departments 

issuing regulations. GAO completed 

more detailed analyses of 123 major 

rules without an NPRM, including 

every such rule published from 2007 

through 2010, to obtain additional 

information to answer the objectives.

What GAO Recommends

GAO recommends that OMB issue 

guidance to encourage agencies to 

respond to comments on final major 

rules, for which the agency has 

discretion, that are issued without a 

prior NPRM. OMB disagreed that 

guidance would offer substantial 

benefits. GAO believes the 

recommendation remains valid, as 

further discussed in the report. 

What GAO Found

Agencies did not publish a notice of proposed rulemaking (NPRM), enabling the 

public to comment on a proposed rule, for about 35 percent of major rules and 

about 44 percent of nonmajor rules published during 2003 through 2010. A 

major rule has significant economic impact and may, for example, have an 

annual effect on the economy of $100 million or more. Agencies published a 

total of 568 major rules from 2003 through 2010. Agencies also published about 

30,000 nonmajor rules during this period, which have less economic significance 

and can involve routine administrative issues.

Agencies frequently cited the “good cause” exception and other statutory 

exceptions for publishing final rules without an NPRM. Agencies in GAO’s 

sample used the “good cause” exception for 77 percent of major rules and 61 

percent of nonmajor rules published without an NPRM. Agencies may use the 

good cause exception when they find that notice and comment procedures are 

“impracticable, unnecessary, or contrary to the public interest.” In practice, 

agencies may find an NPRM “impracticable” when the rule must be issued by a 

statutory deadline, “unnecessary” when the rule pertains to technical corrections, 

and “contrary to the public interest” in an emergency situation. To a lesser extent, 

agencies also used other statutory exceptions to issue a rule without an NPRM. 

For example, in 84 of the 123 major rules that GAO analyzed, agencies 

described circumstances in which a statute: (1) either required or authorized 

them to issue the rule without an NPRM, (2) prescribed the content of the rule, or 

(3) set a deadline for a rule or program which the agency stated did not allow 

sufficient time to issue an NPRM. 

GAO found that agencies, though not required, often requested comments on 

major final rules issued without an NPRM, but they did not always respond to the 

comments received. Agencies may solicit comments through the Federal 

Register when publishing a final rule without an NPRM, but the public does not 

have an opportunity to comment before the rule’s issuance, nor is the agency 

obligated to respond to comments it has received. For example, agencies 

requested comments on 77 of the 123 major rules issued without an NPRM in 

GAO’s sample. The agencies did not issue a follow-up rule or respond to 

comments on 26 of these 77 rules. This is a missed opportunity, because GAO 

found that when agencies did respond to public comments they often made 

changes to improve the rules. In addition, each of these 26 rules is economically 

significant and some of these rules have an impact of a billion dollars a year or 

more. These rules also cover important issues ranging from national health care 

policies to manufacturing incentive programs. For example, in one of the 26 

rules, an agency defined a pre-existing condition to implement the Patient 

Protection and Affordable Care Act and sought public comment. The agency 

received 4,627 comments, but has not published a response to them. When 

agencies do not respond to comments requested, the public does not know 

whether the agency considered their comments, or if it intends to change the 

rule. As the courts have recognized, the opportunity to comment is meaningless 

unless the agency responds to significant points raised by the public. View GAO-13-21. For more information, 

contact Melissa Emrey-Arras at (617) 788-

0534 or emreyarrasm@gao.gov or Robert 

Cramer at (202) 512-7227 or 

cramerr@gao.gov.
Page i GAO-13-21 Federal Rulemaking

Letter 1 

Background 6

Agencies Issued about 35 Percent of Major Rules and about 44 

Percent of Nonmajor Rules without an NPRM from 2003 to 2010 8

Agencies Most Often Invoked the Good Cause Exception When 

Publishing Rules without an NPRM 15

When Agencies Publish Major Rules without an NPRM, They Often 

Provide Information on Economic Effects and Request 

Comments, But Do Not Always Respond to Comments 21

Conclusions 27

Recommendation for Executive Action 28

Agency Comments and Our Evaluation 28

Appendix I Scope and Methodology 31

Appendix II Detailed Results of GAO Analyses of Final Rules Issued 

without an NPRM, 2003 through 2010 36

Appendix III Frequency of Interim Rulemaking, 2003 through 2010 41

Appendix IV Summary Information on Final Major Rules Issued 

without an NPRM, in Whole or in Part—2003 through 2010 45

Appendix V Comments from the Office of Management and Budget 110

Appendix VI GAO Contacts and Staff Acknowledgments 112

Tables

Table 1: General Reasons Cited by Agencies when Invoking the 

Good Cause Exception for Final Rules Published without 

an NPRM from 2003 to 2010 17

Contents 
Page ii GAO-13-21 Federal Rulemaking

Table 2: Specific Statutory Exceptions Cited by Agencies in Major 

Rules without an NPRM from 2003 to 2010 18

Table 3: Disposition of Sample of Rules Published in Rules and 

Regulations Section of the Federal Register, 2003 to 2010 32

Table 4: How Often Agencies Published Final Rules without an 

NPRM, in Whole or in Part, 2003 to 2010 36

Table 5: Exceptions Agencies Cited for Issuing Final Rules without 

an NPRM, in Whole or in Part, 2003 to 2010 37

Table 6: Frequency with which Agencies Issued Interim Rules, 2003 

to 2010 43

Table 7: Summary Information on Major Rules that We Reviewed 

that Agencies Issued without an NPRM, in Whole or in 

Part, from 2003 to 2010 45

Figures

Figure 1: Percentages of Major and Nonmajor Rules That Were 

Published Without an NPRM from 2003 to 2010 9

Figure 2: Frequency of Final Rules Issued without an NPRM from 

2003 to 2010 Was Less Consistent for Major Rules than for 

Nonmajor Rules 11

Figure 3: Agencies that Issued Major and Nonmajor Rules without 

an NPRM from 2003 to 2010 12

Figure 4: Agencies Used Interim Rulemaking More Often for Major 

Rules without an NPRM than for Nonmajor Rules without 

an NPRM from 2003 to 2010 13

Figure 5: Agencies Cited the Good Cause Exception for Most Final 

Rules without an NPRM from 2003 to 2010 15

Figure 6: Whether Selected Agencies Requested Comments and 

Followed Up on 123 Major Rules without an NPRM 25

Figure 7: Whether and How Agencies in Our Sample Addressed 

RFA in Major and Nonmajor Rules without an NPRM, 

2003 to 2010 38

Figure 8: Whether and How Agencies in Our Sample Addressed 

UMRA in Major and Nonmajor Rules without an NPRM, 

2003 to 2010 39

Figure 9: Whether and How Agencies in Our Sample Addressed 

Executive Order 12866 in Major and Nonmajor Rules 

without an NPRM, 2003 to 2010 40

Figure 10: Frequency of Interim Rulemaking Increased over Time 

for Major Rules but was More Consistent for Nonmajor 

Rules, 2003 to 2010 42
Page iii GAO-13-21 Federal Rulemaking

Abbreviations

ACUS Administrative Conference of the United States

APA Administrative Procedure Act

CRA Congressional Review Act

DHS Department of Homeland Security

DOD Department of Defense

DOL Department of Labor

DOT Department of Transportation

EPA Environmental Protection Agency

GPO Government Printing Office

HHS Department of Health and Human Services

NPRM notice of proposed rulemaking

OIRA Office of Information and Regulatory Affairs

OMB Office of Management and Budget

RFA Regulatory Flexibility Act

UMRA Unfunded Mandates Reform Act

USDA Department of Agriculture

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Page 1 GAO-13-21 Federal Rulemaking

United States Government Accountability Office

Washington, DC 20548

December 20, 2012

The Honorable Lamar Smith

Chairman

Committee on the Judiciary

House of Representatives

The Honorable Darrell Issa

Chairman

Committee on Oversight and Government Reform

House of Representatives

The Honorable Ron Johnson

Ranking Member, Subcommittee on Oversight 

 and Government Management, the Federal 

 Workforce, and the District of Columbia

Committee on Homeland Security 

 and Governmental Affairs

United States Senate

Agencies publish on average 3,000 to 4,000 final regulations each year to 

achieve goals such as ensuring the safety of food and products, 

controlling environmental pollution, and providing oversight of financial 

institutions and markets. Regulation is one of the primary tools federal 

agencies use to implement and enforce U.S. laws. Agencies also use 

regulations to implement programs that provide federal assistance, 

grants, and other subsidies. The total costs of these regulations are 

estimated to be in the hundreds of billions of dollars, and the estimated 

benefits are even higher. Given the significant costs and benefits of 

regulations, Congress and the President have focused considerable 

attention on the rulemaking process, especially in recent years, and 

lawmakers continue to consider legislative proposals to amend the 

process.

The basic process by which agencies develop and issue regulations is 

spelled out in the Administrative Procedure Act (APA).1

 

1

5 U.S.C. §§ 551–570a.

APA generally 

requires agencies to (1) publish a notice of proposed rulemaking (NPRM) 

 
 

Page 2 GAO-13-21 Federal Rulemaking

in the Federal Register; (2) allow interested persons an opportunity to 

comment on the rulemaking process by providing “written data, views, or 

arguments;” (3) issue a final rule accompanied by a statement of its basis 

and purpose (including the agency’s response to comments received on 

the NPRM); and (4) publish the final rule at least 30 days before it 

becomes effective. This process, referred to as notice-and-comment 

rulemaking, gives the public an opportunity to provide information to 

agencies on the potential effects of a rule or to suggest alternatives for 

agencies to consider.2 The benefits of public participation in notice-andcomment rulemaking have been cited by the courts and others to include: 

generating higher quality rules; ensuring the fair treatment of persons 

affected by the rules, since all parties potentially affected have a chance 

to participate; and promoting the political accountability of the agency by 

giving affected parties the ability to comment at an early stage and having 

a public record of the agency’s response to those comments.3

Prior notice and public comment is not always required, however.

Congress sometimes enacts laws that direct an agency to issue rules 

without notice and comment. In addition, APA recognizes that there are 

circumstances, such as responding to an emergency situation like a 

natural disaster, when providing for notice and comment might not be 

appropriate before issuing a final rule, because expediting the rulemaking 

process is important to the efficiency and effectiveness of agencies’ 

activities. Therefore, APA allows agencies to issue final rules without the 

use of an NPRM in certain cases, including when the agency determines 

for “good cause” that notice and comment procedures are “impracticable, 

unnecessary, or contrary to the public interest.”4

 

2

5 U.S.C. § 553.

Agencies often invoke 

“good cause,” for example, when Congress prescribes the content of a 

rule by law, such that prior notice and public comment could not influence 

the agency’s action and would serve no useful function.

3

See Richard J. Pierce, Jr., Administrative Law § 6.8 (5th ed. 2011); Ellen R. Jordan, The 

Administrative Procedure Act’s “Good Cause” Exemption, 36 Admin. L. Rev. 113, 116–17 

(1984), “Agencies which listen and respond to public comment enhance their legitimacy 

and accountability, both of critical importance when decisionmaking is delegated to a 

nonrepresentative, politically insulated body.” See also United States v. Utesch, 596 F.3d 

302, 308–09 (6th Cir. 2010) (quoting Dismas Charities, Inc. v. U.S. Dep’t of Justice, 401 

F.3d 666, 678, 680 (6th Cir. 2005)).

4

5 U.S.C. § 553(b)(B).
 

Page 3 GAO-13-21 Federal Rulemaking

In order to retain the benefits of public participation that may be lost when 

issuing rules without an NPRM, agencies sometimes solicit public 

comments on such rules, though not required to do so. If an agency 

solicits comments in these cases, the public’s opportunity to comment 

does not occur in advance of the rule’s issuance or, in some cases, the

effective date for complying with the rule’s provisions. One common type 

of rule often issued without an NPRM is the interim final rule, which 

generally is effective immediately but provides an opportunity for public 

comment after the rule’s issuance. Also, while agencies are required to 

respond to comments received on rules issued with an NPRM when 

those rules are finalized, they have no obligation to respond to comments 

received on final rules issued without an NPRM.5

In 1998, we examined agencies’ publication of rules without an NPRM.

We found that 18 percent (11 of the 61) of the final major rules6 and an 

estimated 51 percent of all rules published during 1997 had been issued 

without an NPRM, often because agencies invoked the good cause 

exception.

7

You asked us to provide information on the frequency, reasons, and 

potential effects of issuing final rules without an NPRM, and whether 

these have changed over time. This report addresses the following 

objectives for final rules published during calendar years 2003 through 

2010:

1. Identify how often agencies issued final rules, including interim rules, 

without an NPRM, whether this changed over time, and which 

agencies most often issued such rules.

 

5

See Indep. U. S. Tanker Owners Comm. v. Lewis, 690 F.2d 908, 918-21 (D.C. Cir. 1982), 

for a discussion of agencies’ obligation to respond to public comments. 

6

A major rule is one that, among other things, has resulted in or is likely to result in an 

annual effect on the economy of $100 million or more. See infra note 20 and 

accompanying text.

7

We are 95 percent confident that the estimated percent of all rules published in 1997 

without an NPRM was between 44 and 58 percent. GAO, Federal Rulemaking: Agencies 

Often Published Final Actions without Proposed Rules, GAO/GGD-98-126 (Washington, 

D.C.: Aug. 31, 1998). 
 

Page 4 GAO-13-21 Federal Rulemaking

2. Identify which exceptions to the requirement for an NPRM agencies 

used when issuing such rules.

3. Assess whether agencies, when issuing final major rules without an 

NPRM (a) provided information on the rule’s economic effects, (b) 

solicited public comments, and (c) responded to public comments.

To address each of these objectives, we used the Government Printing 

Office’s (GPO) Federal Digital System database on the Federal Register

to compile a list of final rules issued during calendar years 2003 through 

2010 from which we drew a sample for our analysis.8 We selected a 

generalizable stratified random sample of 1,338 final rules published 

during the 8-year period. Our sample included all major rules (those that 

have a significant economic effect) issued during calendar years 2007 

through 2010, a random sample of major rules published from 2003 

through 2006, and a random sample of nonmajor rules published from 

2003 through 2010. The sample contained rules by 52 different agencies, 

including every cabinet-level agency issuing regulations and every 

agency that published a major rule during the 8-year period.

We supplemented information from GPO’s Federal Register database 

with information from our database on rules submitted to us under the 

Congressional Review Act (CRA).9

To address the first two objectives, we reviewed the published text of all 

final rules in our sample to determine if they had been issued in whole or 

in part without an NPRM (referred to in this report simply as rules without 

an NPRM) and to identify which exceptions agencies cited when issuing 

those rules. To address our third objective we focused primarily on 

whether agencies issuing major rules without an NPRM: (1) provided 

information on the economic effects of the rules, (2) solicited public 

We tested the reliability of the 

databases used to generate our list of all final rules by reviewing related 

documentation, interviewing knowledgeable agency officials, testing for 

missing data, and tracing a sample of entries to source documents. We 

concluded that the data were sufficiently reliable for our purposes.

 

8

Our analyses of major rules include final regulatory actions published in both the Rules 

and Regulations and the Notices sections of the Federal Register. For simplicity, we use 

the term “final rules” to apply to all final regulatory actions throughout this report. 

9

CRA requires agencies to submit rules to both Houses of Congress and the U.S. 

Comptroller General before the rules can become effective. 5 U.S.C. § 801(a)(1)(A).
 

Page 5 GAO-13-21 Federal Rulemaking

comments, and (3) had responded to comments received on major rules 

without an NPRM by June 30, 2012.

We completed additional content analyses of the 123 major rules without 

an NPRM that we identified in our sample to obtain more detailed 

information on the reasons behind agencies’ use of exceptions to an 

NPRM, how agencies described the economic effects of rules, and 

whether they solicited and responded to public comments. These 123 

rules included all major rules without an NPRM from 2007 through 2010 

and a sample of major rules from 2003 through 2006. Results of these 

content analyses are not generalizable to the entire population of rules; 

they only represent the facts and circumstances of the specific rules we 

reviewed.

We also met with officials from the Office of Management and Budget 

(OMB) and the Administrative Conference of the United States (ACUS) 

who are knowledgeable about federal regulatory and administrative law 

procedures.10

We conducted this performance audit from June 2011 to December 2012 

in accordance with generally accepted government auditing standards.

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

We reviewed ACUS recommendations and OMB guidance 

to executive agencies on the regulatory process. We did not assess the 

agencies’ decisions regarding claims of good cause and other exceptions 

or their determinations regarding the effects of their rules. Instead, we are 

providing information about what the agencies published in the Federal 

Register as the basis for their findings. Detailed information on our scope 

and methodology is included in Appendix I.

 

10ACUS is an independent agency in the executive branch, established as an advisory 

agency in administrative law and procedure. ACUS has broad authority to conduct studies 

and make recommendations for improving the efficiency, adequacy, and fairness of the 

procedures agencies use in carrying out administrative programs.
 

Page 6 GAO-13-21 Federal Rulemaking

APA outlines the process for informal rulemaking, commonly referred to 

as notice-and-comment rulemaking.11 APA includes six broad categorical 

exceptions to this process, including, for example, rules dealing with 

agency organization and procedure (see sidebar).12

In addition, as noted earlier, APA provides that an agency may forego 

notice and comment when it finds “good cause” that notice and public 

comment are “impractical, unnecessary, or contrary to the public 

interest.”13 In the 1946 Senate Judiciary Committee Report on APA, the 

Senate Judiciary Committee described the grounds for a good cause 

exception to include both situations where an agency’s mission would be 

hampered by notice and comment and where public comment would 

serve no useful purpose.14 In creating these exceptions, the drafters of 

APA sought to balance the need for public input with competing societal 

interests favoring the efficient and expeditious conduct of certain 

government affairs.15 When using the good cause exception, APA 

requires an agency to include in the issued rule a brief statement of its 

reasons for finding good cause.16

 

115 U.S.C. § 553. APA also includes provisions on formal rulemaking (“on the record 

rulemaking”), which apply when rules are “required by statute to be determined on the 

record after opportunity for an agency hearing.” 5 U.S.C. § 554(a).

Over the years courts have ruled on 

agencies’ uses of these exceptions, based on the specific facts and 

125 U.S.C. §§ 553(a) and (b). 

135 U.S.C. § 553(b)(B). Agencies may also find “good cause” to exempt a rule from APA’s 

requirement for a 30-day delay of effective date. 5 U.S.C. § 553(d)(3). However, agencies’ 

use of that good cause exception was not within the scope of this review.

14Administrative Procedure Act: Legislative History, S. Doc. No. 79-248, at 200 (1946).

15Jeffrey S. Lubbers, A Guide to Federal Agency Rulemaking, 5th edition (2012), 53. See 

also U.S. Dep’t of Labor v. Kast Metals Corp., 744 F.2d 1145, 1153 (5th Cir. 1984) (noting 

“tension” between agency efficiency and public input). In American Hospital Ass’n v. 

Bowen, 834 F.2d 1037, 1045 (D.C. Cir. 1987), the D.C. Circuit stated that “[t]he reading of 

the § 553 exemptions that seems most consonant with Congress’ purposes in adopting 

the APA is to construe them as an attempt to preserve agency flexibility in dealing with 

limited situations where substantive rights are not at stake.” 

165 U.S.C. § 553(b)(B). When agencies invoke any other exception to the notice and 

comment requirement, they are not similarly required to cite the exception or explain their 

reasoning.

Background 
 

Page 7 GAO-13-21 Federal Rulemaking

circumstances presented in the rules.17 In other cases, statutes, such as 

the 2008 Farm Bill, have authorized or required agencies to issue rules 

without notice and comment.18

CRA, which applies to all agencies, distinguishes between two types of 

rules, major and nonmajor.

When agencies invoke any of these 

exceptions they are not required to request comments from the public or 

conduct certain regulatory analyses.

19 CRA defines a “major” rule as one that, 

among other things, has resulted in or is likely to result in an annual effect 

on the economy of $100 million or more.20 Throughout this report, we 

present results using the CRA distinction between major and nonmajor 

rules. The Office of Information and Regulatory Affairs (OIRA) within OMB 

is responsible for determining whether a rule is major.21

OIRA also is responsible for providing meaningful guidance and oversight 

so that each agency’s regulations are consistent with applicable law, the 

President’s priorities, and the principles set forth in executive orders, and 

that decisions made by one agency do not conflict with the policies or 

actions taken or planned by another agency. Under Executive Order 

12866 (reaffirmed by Executive Order 13563), OIRA reviews significant 

proposed and final rules from agencies, other than independent 

regulatory agencies, before they are published in the Federal Register.

22

 

17Courts have authority to review agencies’ decisions to exempt a rule from notice and 

comment under any one of these exemptions, including good cause. 5 U.S.C. §§ 701-706.

See Clipper Cruise Line, Inc. v. United States, 855 F. Supp. 1 (D.D.C. 1994). For 

examples of differing outcomes when a court reviews an agency’s decision to use “good 

cause,” compare United States v. Dean, 604 F.3d 1275 (11th Cir. 2010) with United 

States v. Utesch, 596 F.3d 302 (6th Cir. 2010).

OIRA also provides guidance to agencies on regulatory requirements. For 

18Food, Conservation, and Energy Act of 2008 (2008 Farm Bill), Pub. L. No. 110-246, § 

1601(c)(2), 122 Stat. 1651, 1729.

19CRA was designed to give Congress an opportunity to review a rule before it takes 

effect and to disapprove any rule to which Congress objects through the passage of a joint 

resolution with presentment to the President. 5 U.S.C. § 801(a)(1)(A).

205 U.S.C. § 804(2).

21Id. 

22“Independent regulatory agencies” refers to the boards and commissions identified as 

such in the Paperwork Reduction Act, for example, the Securities and Exchange 

Commission. 44 U.S.C. § 3502(5).
 

Page 8 GAO-13-21 Federal Rulemaking

example, on August 15, 2011, OIRA issued a primer instructing agencies 

how best to conduct a regulatory impact analysis. In addition to OIRA’s 

previously mentioned responsibilities, according to Executive Order 

12866, OIRA is to be the “repository of expertise concerning regulatory 

issues.” Executive Order 12866, other executive orders, and OIRA 

guidance have all reiterated the importance of public participation and 

regulatory analysis in rulemaking.

During calendar years 2003 through 2010, agencies published 568 major 

rules and about 30,000 nonmajor rules. As shown in figure 1, agencies 

published about 35 percent of major rules and about 44 percent of 

nonmajor rules without an NPRM during those years.23

 

23Sample estimates based on our review of 1,338 final rules are subject to sampling error 

and are presented along with their 95 percent confidence intervals, if applicable. 

Agencies Issued about 

35 Percent of Major 

Rules and about 44 

Percent of Nonmajor 

Rules without an 

NPRM from 2003 to 

2010 
 

Page 9 GAO-13-21 Federal Rulemaking

Figure 1: Percentages of Major and Nonmajor Rules That Were Published Without 

an NPRM from 2003 to 2010

Note: Margins of error for the percentage estimates are shown in parenthesis. For example, an 

estimated 56 percent of nonmajor rules were published without an NPRM, and we are 95 percent 

confident that the actual value is within plus or minus 4 percentage points of this estimate.

a

Agencies published 568 major rules during calendar years 2003 through 2010. All of the variance in 

this estimate for major rules is attributable to the sample of major rules reviewed for the period 2003 

through 2006. We reviewed 100 percent of major rules issued from 2007 on, so results for those 

years have no variance.

b

Agencies published about 30,000 nonmajor rules during calendar years 2003 through 2010.

Examples of major rules without an NPRM include a May 2010 

Department of the Treasury final rule prohibiting certain consumer credit 

practices, for which the agency invoked the good cause exception, and a 

September 2008 Department of Health and Human Services (HHS) 

notice that announced Medicare cost-sharing amounts, for which the 

agency cited an exception in the Social Security Act and good cause.

24

 

2475 Fed. Reg. 23,565 (May 4, 2010) and 73 Fed. Reg. 54,226 (Sept. 18, 2008).

As we observed in our 1998 report, many nonmajor rules without an 

NPRM appeared to involve routine, administrative, or technical issues.
 

Page 10 GAO-13-21 Federal Rulemaking

Similar examples of nonmajor rules without an NPRM that we identified 

during this review included a January 2007 Department of Homeland 

Security (DHS) temporary final rule changing drawbridge operation hours 

for certain bridges in Florida, and a July 2009 Federal Election 

Commission rule allowing a committee that is being audited by the 

Commission to have a hearing prior to the Commission’s adoption of a 

final audit report.25

As illustrated in figure 2, the percentage of nonmajor final rules without an 

NPRM was very consistent across the 8-year period we reviewed; varying 

only slightly among individual years, but the percentage of major rules 

without an NPRM was less consistent. In particular, from 2008 to 2009, 

the percentage of major rules without an NPRM increased from 26 

percent to 40 percent. Agencies issued the largest numbers of major 

rules without an NPRM in 2009 and 2010 (34 in each year), though the 

percentage was higher in 2009 than in 2010. (See app. II for more 

detailed results of the analyses we conducted during this review, 

including numbers, percentages, and confidence intervals.)

 

2572 Fed. Reg. 3,366 (Jan. 25, 2007) and 74 Fed Reg. 33,140 (July 10, 2009).
 

Page 11 GAO-13-21 Federal Rulemaking

Figure 2: Frequency of Final Rules Issued without an NPRM from 2003 to 2010 Was 

Less Consistent for Major Rules than for Nonmajor Rules

Note: Percentages shown are estimates subject to sampling error. The 95 percent confidence 

intervals for each of these estimates are displayed as error bars in the figure.

a

Data points for major rules published from 2007 through 2010 are based on reviewing 100 percent of 

the population, so have no variance. Our supplemental review of all major rules published in 2011 

found that agencies issued 28 percent of those rules without an NPRM.

Two agencies, HHS and the Department of Agriculture (USDA), published 

62 (plus or minus 11) percent of major rules in our sample without an 

NPRM, as shown in figure 3.26

 

26Within HHS, the majority of these rules were published by the Centers for Medicare and 

Medicaid Services. Within USDA, the majority of these rules were published by the 

Commodity Credit Corporation or the Farm Service Agency.

Other agencies accounted for much lower 
 

Page 12 GAO-13-21 Federal Rulemaking

percentages of the total, all 7 percent or less. The Environmental 

Protection Agency (EPA) issued 30 major rules from 2003 through 2010, 

but none of these were issued without an NPRM.27

Figure 3: Agencies that Issued Major and Nonmajor Rules without an NPRM from 

2003 to 2010

For the nonmajor 

rules, the Department of Transportation (DOT), Department of 

Commerce, DHS, and EPA together accounted for almost two-thirds of 

nonmajor rules without an NPRM. All other agencies accounted for 7 

percent or less of the total.

Note: Margins of error for the percentage estimates are shown in parenthesis.

 

27Our supplemental analysis of major rules in 2011 identified one case in which EPA 

waived an NPRM for one part of a rule in response to a court decision (claiming good 

cause because it had no discretion based on its obligation to comply with the court’s 

decision). 76 Fed. Reg. 48,208 (Aug. 8, 2011).
 

Page 13 GAO-13-21 Federal Rulemaking

a

Agencies published 568 major rules during calendar years 2003 through 2010. All of the variance in 

this estimate for major rules is attributable to the sample of major rules reviewed for the period 2003 

through 2006. We reviewed 100 percent of major rules issued from 2007 on, so results for those 

years have no variance.

b

Agencies published about 30,000 nonmajor rules during calendar years 2003 through 2010.

The agencies that published rules in our sample used interim rulemaking 

for a substantial portion of final major rules without an NPRM. As noted 

earlier, an interim rule becomes effective without an NPRM, but the public 

generally may provide comments after the rule’s issuance. Across the 8-

year time period, agencies issued 47 percent of all major final rules and 8 

percent of all nonmajor rules without an NPRM as interim rules. The 

percentage of major rules without an NPRM that used interim rulemaking 

increased from 2007 through 2010 but was more variable for nonmajor 

rules (see fig. 4). Appendix III provides more information on the frequency 

of agencies’ use of interim rulemaking in general.

Figure 4: Agencies Used Interim Rulemaking More Often for Major Rules without an 

NPRM than for Nonmajor Rules without an NPRM from 2003 to 2010
 

Page 14 GAO-13-21 Federal Rulemaking

Note: Percentages shown are estimates subject to sampling error. The 95 percent confidence 

intervals for each of these estimates are displayed as error bars in the above figure.

a

Data points for major interim rules published from 2007 through 2010 are based on reviewing 100 

percent of the population, so have no variance. Our supplemental review of all major rules published 

in 2011 found that 50 percent of the rules without an NPRM were interim rules.

b

Our sample estimates for this time period were not sufficently reliable at a 95 percent confidence 

level.

Across the 554 rules in our sample without an NPRM, agencies used 109 

distinct terms, many of which had only slight wording variations within a 

broad category, to identify the rulemaking action. The majority of these 

terms were variations of five broad categories: final rules, interim rules, 

temporary rules, direct final rules, and notices. In practice, however, there 

may be little distinction between interim rules and certain other rules 

without an NPRM that were described using different terminology. For 

example, a “final rule, request for comments” and an “interim rule with 

request for comments” both provide an opportunity for the public to 

comment only after the rule has been published; these rules are in 

essence the same type of rule. As a result of the inconsistent terminology, 

it would be difficult for Congress to enact legislation on, or for the public to 

easily identify, rules without an NPRM based on what agencies call those 

rules. For example, in legislation to revise rulemaking procedures being 

considered by the 112th Congress, certain provisions would apply when 

agencies, for good cause, issue “interim rules.”28 If the intent is to address 

all rules using the good cause exception, this proposed legislation would 

not achieve that goal since our analysis showed that not all rules for 

which agencies claimed good cause were called “interim rules.” To 

facilitate public participation in the rulemaking process, OMB officials told 

us that they are working with the Office of the Federal Register to 

standardize terminology for agencies to use when publishing rules in the 

Federal Register. 

 

28Regulatory Accountability Act of 2011, H.R. 3010, 112th Cong. (2011). 
 

Page 15 GAO-13-21 Federal Rulemaking

The agencies that published rules in our sample claimed the good cause 

exception in 77 (plus or minus 11) percent of major rules and 61 (plus or 

minus 10) percent of nonmajor rules without an NPRM, as shown in figure 

5 below.

Figure 5: Agencies Cited the Good Cause Exception for Most Final Rules without an 

NPRM from 2003 to 2010

Note: Agencies can cite more than one exception for a given rule.

Agencies Most Often 

Invoked the Good 

Cause Exception 

When Publishing 

Rules without an 

NPRM

Good Cause Exception 

Commonly Used
 

Page 16 GAO-13-21 Federal Rulemaking

a

APA exempts: rules dealing with military and foreign affairs; matters relating to agency management 

or personnel, or to public property, loans, grants, benefits, or contracts; interpretative rules; general 

statements of policy; and rules of agency organization, procedure, or practice.

b

”Other reason” includes those rules for which the agency cited a reason other than one of APA’s

exceptions or another statutory exception.

As discussed previously, there are three general reasons under APA why 

an agency could invoke the good cause exception—impracticable, 

unnecessary, or contrary to the public interest. Agencies tend not to 

precisely distinguish among these reasons, although in practice, for 

example, “impracticable” is used by agencies for rules subject to statutory 

deadlines or time constraints; “contrary to the public interest” is used 

when there are emergencies or threats to public safety; and 

“unnecessary” is used for technical corrections, or for rules where 

comments are unlikely to yield change, such as a rule pursuant to a 

statute that prescribed the content of the rule.29

• Impracticable. The Department of Education issued a 2009 interim 

final rule without an NPRM to implement statutory provisions enacted 

in 2008 related to certain education grants.

Examples of these 

situations and the grounds cited include:

30

• Unnecessary. EPA published a 2010 final rule without an NPRM to 

update and correct the addresses for submitting information to the 

EPA’s Region IX office and certain state and local agency offices.

The statutory provisions 

impacted grant eligibility. The department reported it did not have time 

to complete notice-and-comment procedures before the regulation’s 

effective date of July 1, 2009, which was established by statute.

31

• Contrary to the public interest. The Department of the Interior 

published a 2010 interim final rule without an NPRM to implement 

measures to improve the safety of offshore oil and gas drilling in 

 

29An example of a rule where a statute prescribed the rule’s content was a final action 

making annual rate increases under Medicare, “Medicare Program; Medicare Part B 

Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, 

2011,” 75 Fed. Reg. 68,790 (Nov. 9, 2010). 

3074 Fed. Reg. 20,210 (May 1, 2009).

3175 Fed. Reg. 69,348 (Nov. 12, 2010).
 

Page 17 GAO-13-21 Federal Rulemaking

federal waters.32

For the rules in our sample, agencies most often said that issuing an 

NPRM would be contrary to the public interest, but they also frequently 

cited multiple grounds for invoking the good cause exception (see table 

1). They cited multiple reasons more often for major rules than for 

nonmajor rules—63 (plus or minus 14) percent of major rules and 44 

(plus or minus) percent of the nonmajor rules.

The department published this rule in light of the 

Deepwater Horizon oil spill in the Gulf of Mexico on April 20, 2010.

Table 1: General Reasons Cited by Agencies when Invoking the Good Cause 

Exception for Final Rules Published without an NPRM from 2003 to 2010

General reason for 

citing good cause

Major rules without an 

NPRM that cited the reason 

(percentage)a

Nonmajor rules without an 

NPRM that cited the reason 

(percentage)a

Contrary to the public 

interest 68 (±14) 58 (±8)

Impracticable 55 (±14) 50 (±8)

Unnecessary 49 (±14) 39 (±8)

Source: GAO.

a

Percentages sum to more than100 percent because agencies sometimes cited more than one 

reason for a given rule.

Ninety-two of the 123 major rules without an NPRM in our sample 

invoked the good cause exception. In examining these 92 rules we 

identified five primary categories of explanations (more than one category 

sometimes applies to a given rule):

• a law imposed a deadline either requiring the agency to issue a rule or 

requiring a program to be implemented by a date that agencies 

claimed would provide insufficient time to provide prior notice and 

comment—36 rules;

• a law prescribed the content of the rule issued—31 rules;

• the agency said it was responding to an emergency—19 rules;

 

3275 Fed. Reg. 63,346 (Oct. 14, 2010).
 

Page 18 GAO-13-21 Federal Rulemaking

• the rule implemented technical changes—5 rules; and

• all other explanations (for example, an agency issued a final rule 

without an NPRM in response to a court decision)—14 rules.

After good cause, agencies most often cited specific exceptions in 

statutes other than APA. Such exceptions were cited in 9 (plus or minus 

4) percent of nonmajor rules and in 34 (plus or minus13) percent of all

major rules without an NPRM. More specifically, in 38 of the 123 major 

rules in our sample, we identified 18 different statutory authorities that 

either required or authorized agencies to issue rules without notice and 

comment. For example, the 2008 Farm Bill required the issuance of final 

rules to implement provisions of the law without prior notice and 

comment. HHS, the Department of Labor (DOL), and the Department of 

the Treasury issued several joint rules to implement provisions in the 

Patient Protection and Affordable Care Act as interim rules. In another 

type of example, a provision of the Social Security Act provides an 

exception to notice-and-comment rulemaking when a statute establishes 

a specific deadline for implementation of a rule and the deadline is less 

than 150 days after its enactment. This provision allowed HHS to issue 

several Medicare rules without an NPRM because the Medicare 

Prescription Drug, Improvement, and Modernization Act of 2003 required 

some rules to be issued within shorter time frames than 150 days. Table 

2 provides additional information on all of the statutory exceptions that 

agencies cited for major rules in our sample.

Table 2: Specific Statutory Exceptions Cited by Agencies in Major Rules without an NPRM from 2003 to 2010

Statute or combination of statutes

Whether statute required or 

authorized issuance of final 

rule without an NPRMa

Number of major 

rules that cited the 

exception

Agriculture, Rural Development, Food and Drug Administration, and 

Related Agencies Appropriations Act, 2010 

Required 1 

American Jobs Creation Act of 2004 Required 1 

Consolidated Security, Disaster Assistance, and Continuing 

Appropriations Act of 2009

Required 1 

Consumer Assistance to Recycle and Save Act of 2009 Required 1 

Deficit Reduction Act of 2005 Authorized 1 

Emergency Supplemental Appropriations Act for Defense, the Global 

War on Terror, and Hurricane Recovery, 2006

Required 1 

Energy Employees Occupational Illness Compensation Program Act of 

2000

Authorized 1 

Agencies’ Use of 

Exceptions in Statutes 

Other than APA
 

Page 19 GAO-13-21 Federal Rulemaking

Statute or combination of statutes

Whether statute required or 

authorized issuance of final 

rule without an NPRMa

Number of major 

rules that cited the 

exception

Family Smoking Prevention and Tobacco Control Act Required 1 

Farm Security and Rural Investment Act of 2002 (2002 Farm Bill) Required 2 

Food, Conservation and Energy Act of 2008 (2008 Farm Bill) Required 12

Homeland Security Appropriations Act of 2007 Required 1 

Implementing Recommendations of the 9/11 Commission Act of 2007 Authorized 1 

Social Security Act, Section 1871(b)(1)(B)b Authorized 4 

Sudan Accountability and Divestment Act of 2007 (Amendment to the 

Federal Acquisition Regulation)

Authorized 1 

U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq 

Accountability Appropriations Act, 2007

Required 2 

Three statutory authorities cited: 26 U.S.C. § 9833; 29 U.S.C. § 1191c; 

and 42 U.S.C. § 300gg-92

Authorized 7c

Source: GAO.

a

If a statutory provision requires an agency to issue a final rule without an NPRM, the agency must do 

so. If a statutory provision authorizes issuance of a final rule without an NPRM, an agency may 

choose to do so at its discretion.

b

This provision authorizes an interim final rule to be issued “if a statute establishes a specific deadline 

for the implementation of a provision and the deadline is less than 150 days after the date of 

enactment of the statute.” These rules were issued as interim rules based on various statutes, 

including for example, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, 

Pub. L. No. 108-173, 117 Stat. 2066, and the American Recovery and Reinvestment Act of 2009, 

Pub. L. No. 111-5, 123 Stat. 115.

c

Six of the rules were issued jointly by the Department of the Treasury, DOL, and HHS. All three of 

these statutory authorities include the following: “Consistent with section 104 of the Health Care 

Portability and Accountability Act of 1996, ...[t]he Secretary may promulgate any interim final rules as 

the Secretary deems are appropriate.” One of the rules was issued by HHS alone.

As mentioned earlier, in addition to the good cause exception, APA 

includes six broad categorical exceptions to notice-and-comment 

rulemaking. Agencies that published rules in our sample invoked these 

broad categorical exceptions infrequently. They did so in 11 (plus or 

minus 5) percent of nonmajor rules (most often for rules of agency 

organization, procedure, or practice), and in 8 (plus or minus 11) percent 

of major rules (most often citing the exception for rules on public property, 

loans, grants, benefits, or contracts). These exceptions were cited in 8 of 

the 123 major rules without an NPRM in our sample. The following are 

examples of rules in which agencies cited the six APA categorical 

exceptions:

Agencies’ Use of APA’s 

Broad Categorical 

Exceptions 
 

Page 20 GAO-13-21 Federal Rulemaking

• Military and foreign affairs—cited by a Department of Commerce 2007 

final rule that made several corrections to the Export Administration 

Regulations regarding Libya and terrorist-supporting countries.33

• Agency management or personnel—cited by a General Services 

Administration 2005 rule regarding the Federal Travel Regulation to 

clarify various provisions on temporary duty travel.34

• Public property, loans, grants, benefits, or contracts—cited by the 

Board of Directors of the HOPE for Homeowners Program in a rule 

establishing a temporary Federal Housing Administration program 

providing mortgage insurance for refinanced loans made to avoid 

foreclosure.35

• Interpretative rules—cited by a DOL 2008 rule revising regulations 

implementing the nondiscrimination and affirmative action provisions 

of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, 

as amended.36

• General statements of policy—cited by an HHS 2010 rule revising 

standard federal rates and the extension of wage indexes under the 

Patient Protection and Affordable Care Act for Medicare payments in 

conformance with congressional policy.

According to DOL, it published this rule to codify its 

interpretation of a mandatory job listing requirement.

37

• Agency organization, procedure, or practice—cited by a DOL 2007 

rule amending Occupational Safety and Health Administration 

procedures for handling retaliation complaints.38

In sum, our review of reasons agencies gave for issuing major rules in our 

sample without an NPRM showed that they cited grounds relating to 

 

3372 Fed. Reg. 20,221 (Apr. 24, 2007).

3470 Fed. Reg. 28,459 (May 18, 2005).

35Although published directly by the Board, this is a program under HUD. 73 Fed. Reg.

58,418 (Oct. 6, 2008). 

3673 Fed. Reg. 18,712 (Apr. 7, 2008).

3775 Fed. Reg. 31,118 (June 2, 2010).

3872 Fed. Reg. 44,956 (Aug. 10, 2007).
 

Page 21 GAO-13-21 Federal Rulemaking

statutes for most of the 123 rules we analyzed. Specifically, we found that 

in 84 of the 123 major rules without an NPRM in our sample, agencies 

described circumstances in which a statute: (1) required or authorized 

them to issue the rule without an NPRM, (2) prescribed the content of the 

rule, or (3) set a deadline for a rule or program which the agency stated 

did not allow sufficient time to issue an NPRM.39 About 70 percent of the 

123 major rules in our sample involved, at least in part, the distribution of 

federal payments to the public, such as disaster assistance and 

reimbursement for health care costs. By foregoing notice and comment in 

these cases, agencies expedited the flow of funds to beneficiaries.

Of the 123 major rules without an NPRM that we reviewed, 113 provided 

some estimates of economic effects, such as on the potential costs or 

benefits. Agencies do this because Executive Order 12866 directs nonindependent regulatory agencies to assess economic effects, including 

costs and benefits for all significant rules, whether or not those rules are 

 

39For example, of the 34 major rules issued without an NPRM in 2009, 13 cited statutes 

that required or authorized agencies to issue final rules without an NPRM, 10 were rules 

where the underlying statutes prescribed the content of the rules, and 10 were rules 

responding to statutes that contained deadlines. Sometimes agencies cited more than one 

reason. Of the 13 rules that cited specific statutory exceptions, 9 cited the 2008 Farm Bill.

When Agencies 

Publish Major Rules 

without an NPRM, 

They Often Provide 

Information on 

Economic Effects and 

Request Comments, 

But Do Not Always 

Respond to 

Comments

Agencies Provided 

Information on Economic 

Effects of Most Major 

Rules without an NPRM
 

Page 22 GAO-13-21 Federal Rulemaking

issued with an NPRM.40

Costs and benefits include both quantifiable measures as well as 

qualitative effects that may be difficult to quantify. The information 

provided on costs and benefits in the 123 rules we reviewed varied, and 

included both quantitative and qualitative information. Agencies gave 

quantitative measures of effects for 104 rules,

However, according to OMB officials, the 

requirements of the Executive Order apply only “as practicable.” Of the 

remaining 10 of the 123 rules that we sampled, 5 provided some 

economic information but did not include estimates of the costs or 

benefits, and 5 were issued by independent agencies which are not 

required to comply with the Executive Order.

41 and qualitative 

information on effects for 44 rules included in our sample.42 Appendix IV 

provides summary information about each of the 123 major rules without 

an NPRM, including the potential benefits, costs, and other economic 

effects identified by the agencies.43

Some rules involve monetary payments, known as “transfer payments.” 

These include, for example, payments from the government to the public 

in the form of federal grants, loans, disaster assistance, agricultural 

subsidies, or reimbursements for health care costs. Eighty-six of the 123 

major rules without an NPRM that we reviewed involved transfer 

 

40Executive Order 12866 defines significant regulatory actions as those that are likely to 

result in a rule that may: (1) have an annual effect on the economy of $100 million or more 

or adversely affect in a material way the economy, a sector of the economy, productivity, 

competition, jobs, the environment, public health or safety, or state, local, or tribal 

governments or communities; (2) create a serious inconsistency or otherwise interfere 

with an action taken or planned by another agency; (3) materially alter the budgetary 

impact of entitlements, grants, user fees, or loan programs or the rights and obligations of 

recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, 

the President’s priorities, or the principles set forth in Executive Order 12866.

41Agencies quantified costs for 50 rules, benefits in 10, and transfers in 86.

42An example of a qualitative effect is an October 2009 Securities and Exchange 

Commission rule that identified the qualitative benefit to regulated entities of having more 

time to prepare for compliance with new regulations because the agency delayed their 

effective date. 74 Fed. Reg. 53,628 (Oct. 19, 2009).

43The information in Appendix IV is generally based on GAO’s major rule reports to 

Congress under CRA.
 

Page 23 GAO-13-21 Federal Rulemaking

payments in whole or in part. In these cases, agencies typically reported 

only the estimated budgetary impacts of transfer payments.44

Additionally, rules that have a significant effect on the economy, whether 

or not issued with an NPRM, are subject to review by OIRA. Agencies 

must submit detailed economic analyses of the costs and benefits of all 

reasonably feasible regulatory alternatives to OIRA for review. For 55 of 

the 123 major rules we examined, the rule stated that the agency had 

considered regulatory alternatives.45 For example, in a June 2010 rule on 

the Conservation Stewardship Program, USDA identified and provided 

analyses on five policy options, as well as the option of no program.46 Of 

the 123 major rules we examined, all but 10 were subject to OIRA review.

The 10 rules not subject to OIRA review were issued by independent 

regulatory agencies.47

The Regulatory Flexibility Act of 1980 (RFA) and the Unfunded Mandates 

Reform Act of 1995 (UMRA) also impose separate economic analysis 

requirements for certain rules. RFA requires agencies to assess the 

impact of their rules on “small entities,” such as small businesses.48

UMRA requires agencies to prepare an assessment of the anticipated 

costs and benefits of any rule that may result in the expenditure of $100 

million or more in any 1 year by state, local, or tribal governments in the 

aggregate or by the private sector.49

 

44In some rules implementing budgetary transfers, the agency might have stated that the 

amount of the transfer was a “cost” to the federal government and a “benefit” to 

beneficiaries (such as states or providers of medical services), but if the agency 

characterized all such effects as transfers, we counted them only as transfers.

These requirements do not apply 

when agencies issue a rule without an NPRM, but we observed that 

agencies discussed RFA in 119, and UMRA in 96, of the 123 major rules 

we analyzed. This is consistent with our findings for RFA in 1998. See 

45Agencies may have considered alternatives but did not summarize their findings in the 

published final rules, so there may be other rules among the 123 for which agencies 

considered regulatory alternatives.

4675 Fed. Reg. 31,610 (June 3, 2010).

47Statutes sometimes direct independent regulatory agencies to analyze certain economic 

effects of their rules, such as effects on competition within a regulated industry.

48Small entities are defined as including small businesses, small governmental 

jurisdictions, and certain small not-for-profit organizations. 5 U.S.C. §§ 601, 603. 

492 U.S.C. §§ 1531–1535. 
 

Page 24 GAO-13-21 Federal Rulemaking

Appendix II for detailed results on how agencies addressed the 

requirements of Executive Order 12866, RFA and UMRA.

Of the 123 major rules without an NPRM in our sample, we found that 

agencies requested comments for 77 rules where they had discretion 

over at least part of the regulation’s content. Agencies sometimes solicit 

public comments through the Federal Register on such rules, though not 

required to do so. If an agency solicits comments in these cases, the 

public’s opportunity to comment does not occur in advance of the rule’s 

issuance or, in some cases, the effective date for complying with the 

rule’s provisions. Major rules in which the agency has some discretion 

may benefit from consideration of public comments, because the public

could add value by identifying issues, information, and analyses that the 

agency might not have initially considered.50

 

50Agencies requested comments in 34 percent (plus or minus 6) percent of nonmajor rules 

without an NPRM. However, for these rules, the lack of prior notice and an opportunity to 

comment appears to have had little effect. As noted earlier, many nonmajor rules without 

an NPRM involved routine administrative or technical issues that public comments were 

unlikely to affect. For other nonmajor rules without an NPRM, agencies sometimes used 

alternative procedures to provide advance notice or obtain comments. Moreover, for 

nonmajor “interim rules” in our sample that were subsequently finalized, agencies reported 

receiving comments on about half of the rules and made changes to about 24 percent. 

However, agencies were not 

obligated to respond to comments received on these rules, a key 

difference from comments received on proposed rules when those rules 

are finalized. In 26 of the 77 rules without an NPRM in our sample where 

the agency had discretion, the agency did not publish a follow-up rule or 

respond to any comments received (see figure 6).

Although Not Required, 

Agencies Often Requested 

Comments on Major Final 

Rules Issued without an 

NPRM, but Did Not Always 

Respond to Comments 

Received
 

Page 25 GAO-13-21 Federal Rulemaking

Figure 6: Whether Selected Agencies Requested Comments and Followed Up on 

123 Major Rules without an NPRM

a

Comments may have been received for more than these 15 rules, since certain agencies may not 

have transferred all comments received to the regulations.gov system, which is what we used for our 

analysis.

Typically, agency responses to comments received from the public are 

published in the Federal Register when a follow-up rule is issued. We 

analyzed each of these 77 major rules to determine whether, by the end 

of June 2012, agencies had published a follow-up rule in the Federal 

Register and, if so, whether the agencies reported receiving comments 

and making changes to the original rules.51

 

51We did not limit our search to final rules; we also searched for responses in subsequent 

proposed rules and notices.

In 26 of these 77 rules, there 
 

Page 26 GAO-13-21 Federal Rulemaking

was no follow-up rule. We examined publicly available information and 

found that the public submitted comments for at least 15 of these 26 rules 

but the agencies did not respond to them.52 Each of these 26 rules has 

significant economic effects, with some of these rules having an impact of 

a billion dollars a year or more. These rules also cover important issues 

ranging from national health care policies to manufacturing incentive 

programs. For example, in one of the 26 rules, an agency defined a preexisting condition to implement the Patient Protection and Affordable 

Care Act, and sought public comment. The agency received 4,627 

comments, but has not published a response to them.53 When agencies 

do not publish their response to any comments received, the public 

record is incomplete. The public does not know whether the agency 

considered the comments, accepted or rejected the views or evidence 

presented, or if the agency intends to finalize and potentially change the 

rule. As the courts have recognized, the opportunity to comment is 

meaningless unless the agency responds to significant points raised by 

the public.54

We found that when agencies did respond to public comments they often 

made changes to the rules. In the 51 major rules without NPRMs in our 

sample for which the agencies had discretion and requested comments, 

the agencies did issue a follow-up rule, and our analysis of those cases 

illustrates the potential benefits of follow-up efforts. The agencies 

reported receiving public comments on all but 3 of these 51 major rules, 

which indicates that the public usually takes advantage of the opportunity 

to comment on rules without an NPRM following publication.55

 

52In 2003, the federal government launched the regulations.gov web site to enable 

citizens to search, view, and comment on regulations issued. Comments may have been 

received for more than these 15 rules, since certain agencies may not have transferred all 

dockets or comments received to the regulations.gov system. 

In addition, 

we found that agencies made changes to the text of 31 of the 51 rules, 

most often in response to public comments. For example, DHS finalized a 

53Agency officials explained, however, that 4,100 of these comments were on a single 

aspect of the rule and that public comments informed subsequent program guidance. 

54See, e.g., Alabama Power Co. v. Costle, 636 F. 2d 323, 385 (D.C. Cir. 1979) (quoting 

Home Box Office, Inc. v. FCC, 567 F.2d 9, 35 (D.C. Cir.1977).

55However, in some cases, agencies might not have received comments until after the 

original rules had taken legal effect.
 

Page 27 GAO-13-21 Federal Rulemaking

September 2009 interim rule on air cargo screening in August 2011.56 In 

response to public comments, the agency removed two provisions of the 

original interim rule regarding air cargo screening requirements. These 

changes reduced the costs of the rule. In a similar example, in June 2011, 

the Department of the Treasury, DOL, and HHS followed up on a jointlyissued July 2010 rule on group health plans and health insurance 

issuers.57

Over the years, the Administrative Conference of the United States 

(ACUS), an advisory agency in administrative law and procedure, has 

also highlighted the potential benefits of following up on final rules issued 

without an NPRM. In particular, to ensure public participation and limit 

undesirable effects regarding final rules issued without notice and 

comment, ACUS recommended that agencies request comments 

whenever they invoke the “impracticable” or “contrary to the public 

interest” reasons under the good cause exemption and publish a 

responsive statement on significant and relevant issues raised by such 

comments.

The agencies stated that the amendments in the subsequent 

rule were being made in response to public comments received on the 

prior rule and that the primary effect of the amendments was to reduce 

the costs of compliance.

58 ACUS noted that in such cases public comments could 

provide both useful information to the agency and enhanced public 

acceptance of the rule. Although this recommendation has not been 

implemented, ACUS continues to support it in an effort to improve 

transparency and public participation in rulemaking.

Agencies issue thousands of final rules each year that affect many 

aspects of citizens’ lives. The rulemaking procedures that agencies follow 

balance the public’s right to be involved in the rulemaking process against 

agencies’ need to carry out their missions in an efficient and effective

manner. When rulemaking is expedited, there is a trade-off between 

 

5674 Fed. Reg. 47,672 (Sept. 16, 2009). In this case, DHS was specifically required by law 

to issue an interim rule and then finalize the rule within a specified time frame.

5775 Fed. Reg. 43,330 (July 23, 2010).

58ACUS Recommendation 95-4, Procedures for Noncontroversial and Expedited 

Rulemaking, 60 Fed. Reg. 43,108 (Aug. 18, 1995). ACUS also suggested that agencies 

use such follow-up procedures for other rules issued initially without notice and comment, 

such as interpretative or procedural rules.

Conclusions 
 

Page 28 GAO-13-21 Federal Rulemaking

obtaining the benefits of advanced notice and comment and the goal of 

issuing the rule quickly. The consequences of such trade-offs could be 

most significant for major rules issued without an NPRM, given their 

substantial annual effects on society.

Agencies often lessened this trade-off by requesting public comments on 

rules issued without an NPRM for which they had some discretion. This is 

a positive practice that promotes the benefits of public participation.

However, if agencies and the public are to fully benefit from the process 

of public comments, what matters is not simply providing an opportunity 

for comment but also public understanding of whether comments were 

considered. For more than a third of the major rules published without an 

NPRM between 2003 and 2010 where agencies had discretion and 

requested comments, the agencies did not respond to comments 

received. Some of these rules related to significant national issues such 

as health care. When agencies solicit but leave unclear whether 

comments were considered, the public record is incomplete. Though such 

follow-up is not required, agencies may be missing an opportunity to fully 

obtain for themselves, and provide to the public, the benefits of public 

participation. Further, agencies may create the perception that they are 

making final decisions about the substance of major rules without 

considering data, views, or arguments submitted in public comments. The 

benefit of follow-up efforts is demonstrated by our finding that, when 

agencies did issue follow-up rules, they often made substantive changes 

to the original rules, usually in response to public comments.

To better balance the benefits of expedited rulemaking procedures with 

the benefits of public comments that are typically part of regular noticeand-comment rulemakings, and improve the quality and transparency of 

rulemaking records, we recommend that the Director of OMB, in 

consultation with the Chairman of ACUS, issue guidance to encourage 

agencies to respond to comments on final major rules, for which the 

agency has discretion, that are issued without a prior notice of proposed 

rulemaking.

We provided a draft of this report to the Director of OMB and the 

Chairman of ACUS for their review and comment. We received written 

comments on the draft report from OMB, which are reprinted in Appendix 

V. OMB also provided a technical comment which we incorporated as 

appropriate. ACUS provided technical comments, which we also 

incorporated as appropriate.

Recommendation for 

Executive Action

Agency Comments 

and Our Evaluation
 

Page 29 GAO-13-21 Federal Rulemaking

OMB disagreed with our recommendation to issue guidance to encourage 

agencies to respond to comments on final major rules, for which the 

agency has discretion, that are issued without a prior notice of prior 

rulemaking. OMB stated that it does not believe it is necessary to issue 

guidance on this topic at this time. In its response, OMB reiterated the 

value of public participation during the rulemaking process and noted that 

it routinely encourages agencies to establish procedures to consider 

public comments received on interim final rules. However, OMB believes 

that the timing and extent of an agency’s responses is a discretionary 

matter that an agency must consider in the context of the nature and 

substance of the particular rulemaking, as well as the particular agency’s 

resource constraints and competing priorities. OMB further stated that this 

case-specific approach is generally appropriate—especially given the 

often unique circumstances faced by agencies issuing rules without a 

prior notice of proposed rulemaking—and that it is not aware of 

compelling evidence that a more general, undiscriminating policy, set out 

in guidance, would offer substantial benefits.

We continue to believe that enhanced guidance would improve the quality 

and transparency of rulemaking procedures. We recognize the fact that 

OMB encourages agencies to establish procedures to consider public 

comments but believe that OMB needs to go further to encourage all 

agencies to respond to public comments on the record. We believe that 

there is compelling evidence that such guidance would offer substantial 

benefits. ACUS identified this as an issue of concern in 1995, and our 

current review confirmed that agencies still do not always follow up on 

rules issued without an NPRM. For more than a third of the major rules 

published without an NPRM between 2003 and 2010 where agencies had 

discretion and requested comments, we found that the agencies did not 

respond to comments received. As our evidence demonstrated, some of 

these rules had economic impacts in the billions of dollars, attracted over 

4,000 comments, and addressed significant national issues, such as 

health care. When it is unclear whether agencies considered comments, 

rulemaking is less transparent to the public, and, as courts have 

recognized, the opportunity to comment is meaningless unless the 

agency responds to significant points raised by the public. Further, we 

disagree with OMB’s characterization of the scope of our 

recommendation. We are not suggesting an undiscriminating policy, 

instead we are recommending that OMB work with ACUS to develop 

appropriate guidance. Such guidance could maintain the flexibility for 

agencies that OMB believes is necessary. Also, following up on rules 

issued without an NPRM is not necessarily resource intensive. For 
 

Page 30 GAO-13-21 Federal Rulemaking

example, an agency could simply post a summary response to public 

comments on regulations.gov.

As agreed with your offices, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies to the Director of OMB, the 

appropriate congressional committees, and other interested parties. In 

addition, the report will be available at no charge on GAO’s website at 

http://www.gao.gov. 

If you or your staff has any questions concerning this report, please 

contact Melissa Emrey-Arras at (617) 788-0534 or 

emreyarrasm@gao.gov, or Robert Cramer at (202) 512-7227 or 

cramerr@gao.gov. Contact points for our Offices of Congressional 

Relations and Public Affairs may be found on the last page of this report.

Key contributors are listed in Appendix VI. 

Sincerely yours,

Melissa Emrey-Arras

Acting Director

Strategic Issues

Robert J. Cramer

Managing Associate General Counsel

Office of General Counsel
Appendix I: Scope and Methodology

Page 31 GAO-13-21 Federal Rulemaking

For final rules published during calendar years 2003 through 2010, the 

objectives of this report were to:

1. Identify how often agencies issued final rules, including interim rules, 

without a notice of proposed rulemaking (NPRM), whether this 

changed over time, and which agencies most often issued such rules.

2. Identify which exceptions agencies used when issuing final rules 

without an NPRM.

3. Assess whether agencies, when issuing final major rules without an 

NPRM (a) provided information on the rule’s economic effects, (b) 

solicited public comments, and (c) responded to public comments.

To address each of these objectives, we selected and reviewed a 

representative sample of final regulatory actions published during 

calendar years 2003 through 2010 to estimate the prevalence of certain 

characteristics in this population. We used the Government Printing 

Office’s (GPO) Federal Digital System database on the Federal Register

to compile a list of 30,583 final regulatory actions published in the Rules 

and Regulations section during those years.1 We defined our units of 

analysis as “actions” rather than “final rules,” because not all of the 

individual documents published in the Rules and Regulations section of 

the Federal Register are rules (e.g., some extended comment periods or 

made editorial corrections).2 Further, one published action may include 

multiple rules, and there is no way to determine the total number of rules 

published short of reviewing each action.3

 

1

Published by the Office of the Federal Register, National Archives and Records 

Administration, the Federal Register is the official daily publication for rules, proposed 

rules, and notices of federal agencies and organizations, as well as executive orders and 

other presidential documents. The Rules and Regulations section contains final rules and 

regulations—those regulatory documents having general applicability and legal effect.

However, for simplicity of 

presentation, we use the term “final rules” instead of “final regulatory 

actions” throughout this report. We supplemented information from GPO’s 

Federal Register database with information from our database on rules 

2

This is consistent with our approach in GAO/GGD-98-126. 

3

For example, in November 2010, the Department of Health and Human Services’ 

Centers for Medicare & Medicaid Services included one final rule with comment period, 

two final rules, and one interim final rule with comment period in the same action (75 Fed. 

Reg. 71,800, Nov. 24, 2010). 

Appendix I: Scope and Methodology
Appendix I: Scope and Methodology

Page 32 GAO-13-21 Federal Rulemaking

submitted to us under the CRA.4

From this population of 30,583 final rules published in the Rules and 

Regulations section from 2003 through 2010, we selected a 

generalizeable stratified sample of 1,311 final rules. To ensure that we 

reviewed the rules expected to have the most significant effects, we 

selected all major rules, as identified under the CRA for calendar years 

2007 through 2010.

We tested the reliability of the databases 

used to generate our list of all final rules by reviewing related 

documentation, interviewing knowledgeable agency officials, testing for 

missing data, and tracing a sample of entries to source documents. We 

concluded that the data were sufficiently reliable for our purposes.

5 The remaining rules during this period were stratified 

and sampled by year (2007 through 2010) and by whether they contained 

the term “interim” in the text of the Federal Register action.6

Table 3: Disposition of Sample of Rules Published in Rules and Regulations 

Section of the Federal Register, 2003 to 2010

We also 

included rules for calendar years 2003-2006 in our sample. For this 

period, we grouped the rules into three additional strata: major rules, 

“interim” rules, and other rules. Table 3 summarizes the population and 

sample size by stratum.

Samplea

Rule stratum Populationa Total 

selected

In 

scope

Out of 

scopeb

2007-2010 major rules 313 313 313 0 

2010 other (excluding interim) 2,889 144 144 0

2010 interimc 594 51 48 3 

 

4

CRA requires agencies to submit rules to both Houses of Congress and the Comptroller 

General before the rules can become effective. 5 U.S.C. § 801(a)(1)(A).

5

As defined by CRA, a major rule is a rule that the Administrator of the Office of 

Information and Regulatory Affairs finds has resulted in or is likely to result in (1) an 

annual effect on the economy of $100 million or more, (2) a major increase in costs or 

prices, or (3) significant adverse effects on competition, employment, investment, 

productivity, or innovation. CRA requires GAO to prepare a report to Congress on each 

major rule. 5 U.S.C. § 804(2).

6

Our preliminary research showed that we could not identify rules that were related to an 

interim rulemaking based on rules’ titles or on how agencies named the actions. We 

stratified on whether the word “interim” occurred in the text of the action to increase the 

chance of capturing interim rules in our sample.
Appendix I: Scope and Methodology

Page 33 GAO-13-21 Federal Rulemaking

Samplea

Rule stratum Populationa Total 

selected

In 

scope

Out of 

scopeb

2009 other (excluding interim) 2,801 144 140 4 

2009 interimc 579 50 45 5 

2008 other (excluding interim) 3,136 147 146 1 

2008 interimc 593 50 48 2 

2007 other (excluding interim) 2,971 146 140 6 

2007 interimc 569 48 48 0 

2003-2006 major 207 27 27 0 

2003-2006 other (excluding 

interim)

13,135 157 155 2 

2003-2006 interimc 2,796 34 33 1 

Total 30,583 1,311 1,287 24

Source: GAO. 

a

The population total excludes 48 major rules and the sample total excludes 27 major rules that 

agencies published in the Notices section of the Federal Register. 

b

Rules that were outside of the scope of this review included those for which informal rulemaking 

procedures under the Administrative Procedure Act did not apply, such as when an agency used 

formal rulemaking procedures or when the published action was not a rule of general applicability. 

Based on the 24 sample cases in this category, we estimate a total population of 587 such actions 

published in the Rules and Regulations section of the Federal Register over the 8-year period, with a 

95 percent confidence interval lower bound estimate of 315 actions and an upper bound estimate of 

994 actions.

c

The “interim” strata was composed of rules whose text included the term interim. Not all of these 

were interim rules.

Based on this sample, we are able to estimate characteristics of the 

population of all final rules published in the Rules and Regulations section 

of the Federal Register. To ensure that all the rules expected to have the 

most significant effects were reviewed, we also included an additional 27 

major rules that were not published in the Rules and Regulations section, 

but instead were published as Notices (bringing the total number of rules 

we reviewed to 1,338).7

 

7

To supplement our review for changes over time, we also conducted a limited analysis of 

all 80 major rules published during calendar year 2011.

For this report, when we present estimates for all 

major rules, we are projecting to the major rules published in both the 

Rules and Regulations section and those published in Notices. All other 

estimates presented in this report are estimates of the population of rules 

published in the Rules and Regulations section for 2003 through 2010.
Appendix I: Scope and Methodology

Page 34 GAO-13-21 Federal Rulemaking

Our sample contained rules by 52 different agencies, including every 

cabinet-level agency issuing regulations and every agency that published 

a major rule during the 8-year period.

Because this is a probability sample, our sample is only one of a large 

number of samples that we might have drawn. Since each sample could 

have provided different estimates, we express our confidence in the 

precision of our particular sample’s results as a 95 percent confidence 

interval (for example, plus or minus 7 percentage points). This is the 

interval that would contain the actual population value for 95 percent of 

the samples we could have drawn.

We reviewed the published text of all selected final rules to determine if 

they had been published in whole or in part without NPRMs (referred to in 

the rest of this report simply as rules without NPRMs). Our analysis 

included rules where only a part of the rule was issued without an NPRM 

to ensure that our results reflected all instances when agencies cited an 

exception to notice and comment. To address our third objective we 

focused primarily on whether agencies issuing major rules without an 

NPRM: (a) provided information on the economic effects of the rules, (b) 

solicited public comments when issuing final rules without an NPRM, and 

(c) responded to comments received on major rules without an NPRM by 

June 30, 2012. We used standardized data collection instruments and 

applied criteria from the Administrative Procedure Act, Regulatory 

Flexibility Act, Unfunded Mandates Act, and Executive Order 12866 to 

collect and analyze information to address each key question. If the final 

rule in our sample was not itself a rule, but was related to a rulemaking 

(e.g., if it extended a comment period) we used the underlying rule to 

address our questions if sufficient information was provided to identify the 

underlying rule. In addition to using our sample to generate estimates for 

the entire population on these objectives, we also did additional content 

analyses of the major rules without NPRMs in our sample to help address 

the objectives. Unlike the generalizable results from our reviews of the 

broader sample of rules, the results of these content analyses are not 

generalizable to the entire population. They only represent the facts and 

circumstances of the specific rules we reviewed. We also met with 

officials from the Office of Management and Budget (OMB) and 

Administrative Conference of the United States (ACUS) who are 

knowledgeable about federal regulatory and administrative law 

procedures.

We did not assess the agencies’ decisions regarding claims of good 

cause and other exceptions or their determinations regarding the effects 
Appendix I: Scope and Methodology

Page 35 GAO-13-21 Federal Rulemaking

of their rules; instead, we are providing information about what the 

agencies published in the Federal Register as the basis for their findings.

Further, we limited our analysis to only what agencies specifically stated 

in Federal Register notices. For example, we counted a particular 

exception only if the agency specifically cited it or quoted from part of 

APA’s description. We did not assume that an agency meant to claim a 

particular exemption based on the general content of the rule. Therefore, 

our results may understate the frequency with which APA’s good cause 

and categorical exceptions applied.

We conducted this performance audit from June 2011 to December 2012 

in accordance with generally accepted government auditing standards.

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix II: Detailed Results of GAO Analyses 

of Final Rules Issued without an NPRM, 2003 

through 2010

Page 36 GAO-13-21 Federal Rulemaking

Tables 4 and 5 in this appendix provide more detailed information on the 

results of various analyses we completed for this report, including the 

upper and lower bounds of confidence intervals for estimated values, as 

appropriate. Figures 7 through 9 in this appendix provide more detailed 

information on how agencies addressed the RFA, UMRA, and Executive 

Order 12866, reported by agencies under the Congressional Review Act 

(CRA), including confidence intervals for our estimates.

Table 4: How Often Agencies Published Final Rules without an NPRM, in Whole or in Part, 2003 to 2010

Estimated frequency (percentage)

95 percent confidence intervals

Type of final rule and year(s) published Population total Point estimate Lower bound Upper bound

All major rules 2003-2010 568 35% 28% 41%

2010 major rules 100 34 a a

2009 major rules 84 40 a a

2008 major rules 95 26 a a

2007 major rules 61 33 a a

2003-2006 major rules 228 37 20 57

All nonmajor rules 2003-2010 30,063 44 39 48

2010 nonmajor rules 3,483 42 35 49

2009 nonmajor rules 3,380 44 37 51

2008 nonmajor rules 3,729 44 37 51

2007 nonmajor rules 3,540 46 39 53

2003-2006 nonmajor rules 15,931 43 36 50

Source: GAO. 

Our supplemental analysis of the 80 major rules published in 2011 found that agencies issued 28 

percent in whole or in part without NPRMs.

a

Not applicable. The frequency for this time period was based on reviewing all rules in the population.

Appendix II: Detailed Results of GAO 

Analyses of Final Rules Issued without an 

NPRM, 2003 through 2010
Appendix II: Detailed Results of GAO Analyses 

of Final Rules Issued without an NPRM, 2003 

through 2010

Page 37 GAO-13-21 Federal Rulemaking

Table 5: Exceptions Agencies Cited for Issuing Final Rules without an NPRM, in Whole or in Part, 2003 to 2010 

Estimated frequency (percentage) 

95 percent confidence intervals

Category of final rule/Exception cited Point estimate Lower bound Upper bound

Major rules, 2003—2010a 

APA good cause 77% 65% 86%

APA broad categorical 8 2 18

Military or foreign affairs function of the United States 1 0 1 

Matter relating to agency management or personnel 0 0 0 

Matter relating to public property, loans, grants, 

benefits, or contracts 6 1 18

Interpretive rules 1 0 1 

General statements of policy 1 0 1 

Rules of agency organization, procedure, or practice 2 2 3 

Other specific statutory exceptions 34 23 47

Other reasonb 4 3 5 

No reason 0 0 0 

Nonmajor rules 2003—2010c

APA good cause 61 55 67

APA broad categorical 11 7 15

Military or foreign affairs function of the United States 2 1 4 

Matter relating to agency management or personnel 2 1 5 

Matter relating to public property, loans, grants, 

benefits, or contracts 0 0 1 

Interpretive rules 1 0 4 

General statements of policy 0 0 0 

Rules of agency organization, procedure, or practice 5 3 9 

Other specific statutory exceptions 9 6 13

Other reasonb 12 8 16

No reason 10 6 15

Source: GAO. 

Note: An agency could have cited more than one exception or reason for a given rule.

a

N = 547 final rules.

b

”Other reason” includes those rules for which the agency cited a reason other than one of APA’s

exceptions or another statutory exception.

c

N = 30,039 final rules.
Appendix II: Detailed Results of GAO Analyses 

of Final Rules Issued without an NPRM, 2003 

through 2010

Page 38 GAO-13-21 Federal Rulemaking

Figure 7: Whether and How Agencies in Our Sample Addressed RFA in Major and Nonmajor Rules without an NPRM, 2003 to 

2010

a

Percentages of responses for rules that addressed RFA exceed 100 percent, because agencies 

could have responded in more than one way.

b

For these estimates, the 95 percent confidence is within less than plus or minus 0.5 percentage 

points of the estimated percentage.

RFA applies to all agencies, but the requirements under RFA to prepare 

initial and final regulatory flexibility analyses only apply to rules for which 

an agency is required to publish an NPRM. Nevertheless, agencies often 

discussed RFA in their rules without NPRMs.
Appendix II: Detailed Results of GAO Analyses 

of Final Rules Issued without an NPRM, 2003 

through 2010

Page 39 GAO-13-21 Federal Rulemaking

Figure 8: Whether and How Agencies in Our Sample Addressed UMRA in Major and Nonmajor Rules without an NPRM, 2003 

to 2010

UMRA applies to agencies other than independent regulatory agencies, 

and UMRA’s requirements only apply to rules for which an agency 

published an NPRM. Nevertheless, agencies often discussed UMRA in 

their rules without NPRMs.
Appendix II: Detailed Results of GAO Analyses 

of Final Rules Issued without an NPRM, 2003 

through 2010

Page 40 GAO-13-21 Federal Rulemaking

Figure 9: Whether and How Agencies in Our Sample Addressed Executive Order 12866 in Major and Nonmajor Rules without 

an NPRM, 2003 to 2010

a

For these estimates, the 95 percent confidence is within less than +/- 0.5 percentage points of the 

estimated percentage.

Executive Order 12866 procedural and analytical requirements only apply 

to significant rules, and the requirement to provide the underlying analysis 

of benefits and costs only applies to rules that are economically 

significant (generally those with an annual impact of $100 million or 

more). The executive order does not apply to independent regulatory 

agencies.
Appendix III: Frequency of Interim Rulemaking, 

2003 through 2010

Page 41 GAO-13-21 Federal Rulemaking

Interim final rules are rules that agencies often, but not always, issue 

without an NPRM and provide the public an opportunity to comment after 

the rule has taken effect. APA does not address interim rulemaking, 

although in 1995, ACUS recommended that agencies adopt a form of 

interim rulemaking,1 and Congress has expressly authorized this 

procedure in legislation.2

Overall, agencies appeared to use interim rulemaking infrequently.

Between 2003 and 2010, agencies published about 4 (plus or minus 2) 

percent of nonmajor rules as interim rules. There was relatively little 

variation across the individual years in the percentage of nonmajor interim 

rules (see fig. 14). However, for major rules, we found that 15 percent 

(actual) of all major rules from 2003 through 2010 were issued as interim 

rules. The number of major interim rules increased starting in 2008 and 

was highest in 2010, when 23 of 100 major rules were an interim rule or 

included an interim rule among other final rules. A few of the cases 

involving interim rules that we reviewed (17 of the 120) had prior 

proposed rules.

In our 1998 report on final actions without 

NPRMs, we had estimated that agencies published about 400 interim 

final rules per year from 1992 to 1997 (out of approximately 4,000 total 

final rules each of those years).

 

1

ACUS Recommendation 95-4, Procedures for Noncontroversial and Expedited 

Rulemaking, 60 Fed. Reg. 43,108, 43,110–113 (Aug. 18, 1995). See also Michael R. 

Asimow, Interim-Final Rules Making Haste Slowly, 51 Admin. L. Rev. 703 (1999).

2

See, for example, the Deficit Reduction Act of 2005, Pub. L. No. 109-171, § 6052(b), 120 

Stat. 4, 95 (2006).

Appendix III: Frequency of Interim 

Rulemaking, 2003 through 2010
Appendix III: Frequency of Interim Rulemaking, 

2003 through 2010

Page 42 GAO-13-21 Federal Rulemaking

Figure 10: Frequency of Interim Rulemaking Increased over Time for Major Rules 

but was More Consistent for Nonmajor Rules, 2003 to 2010

a

Data points for major interim rules are based on reviewing 100 percent of the population, so have no 

variance. Our supplemental review of all major rules published in 2011 found that 14 percent of those 

rules were interim rules, or included interim rules along with other final rules.

We reviewed a total of 120 interim rules within our sample, 56 of which 

were major and 64 nonmajor. Three agencies issued more than half of 

the major interim rules we reviewed, with the Department of Health and 

Human Services (HHS) accounting for 23 percent, the Department of 

Agriculture (USDA) 18 percent, and the Department of Homeland 

Security (DHS) 11 percent. All other agencies in our sample accounted 

for less than 7 percent each of the total major interim rules we reviewed.

For the nonmajor interim rules, four agencies accounted for 

approximately two-thirds of these rules, with USDA accounting for 22 

percent, DHS 22 percent, the Department of Defense (DOD) 14 percent, 

and HHS 11 percent. All others counted for less than 5 percent each of 
Appendix III: Frequency of Interim Rulemaking, 

2003 through 2010

Page 43 GAO-13-21 Federal Rulemaking

the total. There may be other agencies that issued interim rules that did 

not appear in our sample. Table 6 provides the detailed results of our 

analysis, by time period, with confidence intervals.

Table 6: Frequency with which Agencies Issued Interim Rules, 2003 to 2010

Estimated frequency (percentage) 

95 percent confidence intervals

Type of final rule and year(s) 

published Population total Point estimate Lower bound Upper bound

All major rules 2003-2010 568 14% a a

• 2010 major rules 100 22 a a

• 2009 major rules 84 13 a a

• 2008 major rules 95 11 a a

• 2007 major rules 61 8 a a

• 2006 major rules 56 14 a a

• 2005 major rules 56 16 a a

• 2004 major rules 66 12 a a

• 2003 major rules 50 12 a a

All nonmajor rules 2003-2010 30,063 4 3 6 

• 2010 nonmajor rules 3,483 4 2 6 

• 2009 nonmajor rules 3,380 7 5 9 

• 2008 nonmajor rules 3,729 3 2 5 

• 2007 nonmajor rules 3,540 6 4 8 

• 2003-2006 nonmajor rules 15,931 4 2 8 

Source: GAO. 

Note: Our supplemental analysis of the 80 major rules published in 2011 found that agencies issued 

14 percent as interim rules.

a

Not applicable. The frequency for this time period was based on reviewing all rules in the population.

There is no general requirement for agencies to finalize interim rules, but 

we did a “look forward” analysis for each of the 120 interim rules in our 

sample to determine how many of those rules agencies had subsequently 

finalized and, if so, whether the agencies reported receiving comments or 

making changes to those rules. By the end of June 2012, agencies in our 

sample had finalized almost half of the interim rules—29 of the 56 major 

interim rules in our sample and 37 of the 64 nonmajor interim rules. It took 
Appendix III: Frequency of Interim Rulemaking, 

2003 through 2010

Page 44 GAO-13-21 Federal Rulemaking

these agencies on average 452 days (about 1 year, 3 months) after 

publication of the original interim rules to finalize the rules,3

 

3

The range was from 63 days (about 3 months) to 2,307 days (about 6 years, 4 months).

so agencies 

may eventually finalize additional interim rules from our sample. Agencies 

in our sample frequently reported receiving comments on and making 

changes to interim rules that they finalized, especially in the case of major 

interim rules. These agencies received public comments on all but 2 of 

the major interim rules that were subsequently finalized. In addition, 

agencies in our sample made changes to the text of 15 of the 29 major 

interim rules when they were finalized, most often in response to public 

comments.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 45 GAO-13-21 Federal Rulemaking

The following tables provide information about each of the 123 major 

rules issued without an NPRM from 2003 through 2010 that we reviewed 

for this report. Rules for which agencies waived NPRMs for only part of 

the rule are designated with (P) where we identify the exceptions to 

NPRMs that were cited. The narratives on each rule are summarized 

primarily from the relevant major rule reports that we submitted to 

Congress under CRA. CRA requires us to report on the issuing agency’s 

compliance with procedural steps required by various acts and executive 

orders governing the rulemaking process. Links to those reports are 

provided in the Rule column. In some cases where the published rule 

contained other relevant summary information on estimated economic 

effects that was not reflected in the major rule report, we added that 

information to the summary. The entries are sorted by agency and 

presented chronologically by the published date of the rule. Joint rules 

issued by more than one agency are listed at the end of each table.

Because of differences in methods and assumptions (for example, 

discount rates, inflation), the agencies’ estimates may not be comparable.

Table 7: Summary Information on Major Rules that We Reviewed that Agencies Issued without an NPRM, in Whole or in Part, 

from 2003 to 2010

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Agriculture 

(USDA) 

1 Rule title: 2002 Farm Bill—

Conservation Reserve Program—

Long-Term Policy

Date: May 8, 2003

Sub-agency: Commodity Credit 

Corporation (CCC)

Action: Interim rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-03

-785R

The interim rule amends the 

Conservation Reserve Program (CRP) 

regulations to set forth the terms and 

conditions of enrolling acreage in the 

CRP, update program eligibility 

requirements, eliminate unnecessary 

regulations, and improve the remaining 

regulations. The rule implements 

changes made to the CRP by the 2002 

Farm Bill.

CCC performed a cost-benefit analysis of the 

interim rule. Total CRP outlays are estimated 

to increase $1.5 billion, while commodity 

program outlays are estimated to decline about 

$1.7 billion during fiscal years 2003 through 

2012, primarily due to a $1.5 billion countercyclical payment decline. The additional 2.8 

million-acre enrollment is estimated to 

decrease combined CRP and commodity 

program outlays by $208 million annually 

during the 10-year period. Total estimated 

impacts for the additional CRP enrollment, 

including $326 million annual economic losses 

due to higher crop prices and reduced crop 

supplies (buyers’ loss) and estimated average 

annual economic benefits (increased farm 

incomes and environmental benefits), results 

in estimated net economic benefits of $131 

million per year.

Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in 

Whole or in Part—2003 through 2010
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 46 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

2 Rule title: User Fees for Agricultural 

Quarantine and Inspection Services

Date: December 9, 2004

Sub-agency: Animal and Plant 

Health Inspection Service

Action: Interim rule and request for 

comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-05

-217R 

The interim rule adjusts the user fees 

charged for certain agricultural 

quarantine and inspection (AQI) 

services that are provided in connection 

with certain commercial vessels, 

commercial trucks, commercial railroad 

cars, commercial aircraft, and 

international airline passengers arriving 

at port in the customs territory of the 

United States. The adjusted AQI user 

fees cover fiscal years 2005 through 

2010.

USDA performed a cost-benefit analysis of the 

interim rule. The analysis projects costs for 

fiscal years 2005 through 2010 based on fiscal 

year 2004 costs of $327 million. It increased 

the amount by a factor of 1.5 percent for each 

year for pay increases and general inflation 

cost increases. In addition, a 25-percent factor 

of the cost of the program was added to 

contribute to a reserve fund that USDA states 

is necessary to ensure continuity of services in 

cases of fluctuation in volumes, bad debt, 

carrier insolvency, and other unforeseen 

events. USDA finds the projected revenue 

from the fees will range from $355.8 million in 

fiscal year 2005 to $381.3 million in fiscal year 

2010. Without the increases, USDA’s analysis 

shows program-funding shortfalls of $112.5 

million to $123.8 million. 

3 Rule title: Tobacco Transition 

Payment Program

Date: April 4, 2005

Sub-agency: Farm Service Agency 

(FSA) and Commodity Credit 

Corporation

Action: Final rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-05

-560R

The final rule provides regulations for 

the Tobacco Transition Payment 

Program (TTPP), as required by the 

American Jobs Creation Act of 2004, 

ending the tobacco marketing quota and 

price support loan programs. The TTPP 

will continue to provide payments over a 

10-year period during the transition from 

the federally-regulated program.

USDA estimates that payments to quota 

owners, based upon known payment rates and 

applicable quota levels, will be about $6.7 

billion. Tobacco producers eligible for 

payments under the American Jobs Creation 

Act of 2004 are estimated to receive about 

$2.9 billion, based upon the specified payment 

rate and known quota amounts.

4 Rule title: 2005 Section 32 Hurricane 

Disaster Programs; 2006 Livestock 

Assistance Grant Program

Date: January 9, 2007

Sub-agency: Farm Service Agency

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-715R

The final rule provides for the 

establishment of four hurricane disaster 

programs and one grant program to 

provide funds to eligible producers who 

suffered eligible losses in counties 

affected by the 2005 hurricanes Katrina, 

Ophelia, Rita, or Wilma, the drought 

during March through August 2006; or a 

related condition.

The named hurricanes and other related 

disasters severely limited the purchasing 

power of farmers engaged in the production of 

agricultural commodities. The final rule 

provides for the establishment of four 

hurricane disaster programs to be 

administered by FSA in order to provide funds 

to eligible producers who suffered eligible 

losses, and a grant program to enable named 

states to assist aquaculture producers who 

suffered losses. One purpose of these 

programs is to reestablish these producers’ 

purchasing power. FSA performed a costbenefit analysis of this final rule for each of the 

four disaster programs and the grant program 

under which funds are available.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 47 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

5 Rule title: 2006 Emergency 

Agricultural Disaster Assistance 

Programs 

Date: February 12, 2007

Sub-agency: Commodity Credit 

Corporation

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report:

http://www.gao.gov/products/GAO-07

-511R

The final rule implements the 

Emergency Agricultural Disaster 

Assistance Act of 2006 and establishes 

seven disaster programs to provide 

funds to eligible producers in counties 

affected by the 2005 hurricanes Katrina, 

Ophelia, Rita, or Wilma, or a related 

condition. To be eligible, counties must 

have been designated or declared a 

major disaster or emergency area, or be 

contiguous counties. 

The named hurricanes severely limited the 

purchasing power of farmers engaged in the 

production of agricultural commodities. The 

final rule provides for the establishment of 

seven hurricane disaster programs to be 

administered by FSA in order to provide funds 

to eligible producers who suffered eligible 

losses, thus reestablishing these producers’ 

purchasing power. FSA performed a costbenefit analysis of this final rule for each of the 

seven disaster programs under which funds 

are available.

6 Rule title: Prohibition of the Use of 

Specified Risk Materials for Human 

Food and Requirements for the 

Disposition of Non-Ambulatory 

Disabled Cattle; Prohibition of the 

Use of Certain Stunning Devices 

Used To Immobilize Cattle During 

Slaughter

Date: July 13, 2007

Sub-agency: Food Safety and 

Inspection Service (FSIS)

Action: Affirmation of interim final 

rules with amendments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-1123R

The final rule affirms two interim final 

rules published in January 2004. The 

interim rules and this final rule are 

measures taken to minimize human 

exposure to cattle materials that could 

potentially contain the bovine 

spongiform encephalopathy (BSE) 

agent. This final rule designates certain 

materials from cattle as specified risk 

materials, and, prohibits their use for 

human food. The rule prohibits the 

slaughter for human food of any nonambulatory disabled cattle. The rule 

also prohibits the use of “air-injection” 

stunning.

FSIS analyzed costs and benefits of this rule in 

its regulatory impact analysis. The benefits of 

the final rule primarily result from the relative 

reduction in human exposure to BSE infectivity 

and the restoration of beef exports. FSIS 

estimates that the total average annual cost of 

this final rule to be $171.2 million annualized 

over 5 years. There are no costs associated 

with the prohibition of air-injection stunning

because that method is no longer used in the 

United States.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 48 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

7 Rule title: Emergency Agricultural 

Assistance, 2007; Crop Disaster and 

Livestock Indemnity Programs

Date: December 21, 2007

Sub-agency: Farm Service Agency

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-392R

The final rule established regulations for 

a Crop Disaster Program which applies 

to 2005, 2006, and 2007 crop producers 

and a Livestock Indemnity Program 

(LIP) that applies to livestock producers 

in counties designated as a major 

disaster or emergency area between 

January 1, 2005, and February 28, 

2007. 

FSA prepared a cost-benefit analysis and 

published a summary of the analysis with this 

final rule. FSA estimates that total crop 

disaster payments will range from $1.6 billion 

to $2. billion. FSA expects payment rates to be 

lower than past crop disaster programs 

because of program changes. Changes 

include making insurable crops that were not 

insured and crops that were eligible for but not 

covered by the Noninsured Crop Disaster 

Assistance Program ineligible for payment and 

requiring at least 25-percent quality loss for 

compensation. FSA expects payment rates 

may be higher due to provisions that allow 

production of a commodity sold through 

marketing contracts to be eligible for quality 

loss assistance based on the prices specified 

in the contracts. FSA estimates that claims 

under the 2005-2007 LIP will be $14.4 million. 

FSA does not expect the impact on any sector 

of the economy to be measurable nor does it 

expect any significant change in aggregate 

social welfare. FSA expects that participants 

and their local communities may benefit by 

losses that are offset or reduced by the LIP 

payments.

8 Rule title: 2005-2007 Livestock 

Compensation and Catfish Grant 

Programs 

Date: December 21, 2007

Sub-agency: Farm Service Agency

Action: Final rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-393R 

The final rule implements legislation that 

provides for the continuation of the 

Livestock Compensation Program and 

the Catfish Grant Program (CGP). The 

programs will provide financial 

assistance to producers in counties 

designated as a major or natural 

disaster between January 1, 2005, and 

February 28, 2007.

FSA prepared a cost-benefit analysis and 

published a summary of the analysis with this 

final rule. FSA estimates that claims under the 

2005-2007 Livestock Compensation Program 

(LCP) will be $684 million. FSA does not 

expect the impact on any sector of the 

economy to be measurable nor does it expect 

any significant change in aggregate social 

welfare. FSA expects that participants and 

their local communities may benefit by losses 

that are offset or reduced by the LCP 

payments. FSA estimates that the expected 

value of the block grants necessary to 

compensate expected feed losses under the 

CGP will be $3.7 million. FSA expects that 

grant assistance should help catfish producers 

to restore their purchasing power from feed 

losses incurred by disasters that occurred after 

January 1, 2005, but before February 28, 

2007.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 49 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

9 Rule title: Cotton World Price 

Determination

Date: May 27, 2008

Sub-agency: Commodity Credit 

Corporation and Farm Service 

Agency

Action: Final rules

Exception(s) to NPRM cited: 

Statutory

GAO major rule report:

http://www.gao.gov/products/GAO-08

-963R

The final rule revises the Upland Cotton 

regulations to use the Far East (FE) 

prices instead of Northern Europe 

prices in determining the adjusted world 

price (AWP).

CCC prepared a cost-benefit analysis of this 

final rule. CCC states that the final rule 

changes its regulations to recognize the shift in 

world cotton trade to the FE market that has 

occurred over time. In addition, it allows the 

program to operate in the manner that CCC 

and market participants have found 

consistently provides a smooth transition 

between crop years, while reducing potential 

CCC budgetary outlays. CCC states that the 

switch to FE as the basis for determining the 

cotton AWP is expected to generate modest 

savings as lower transportation costs to the 

FE. The net effect will likely raise the AWP, 

reducing CCC’s exposure on marketing loan 

benefits.

10 Rule title: Mandatory Country of 

Origin Labeling of Beef, Pork, Lamb, 

Chicken, Goat Meat, Perishable 

Agricultural Commodities, Peanuts, 

Pecans, Ginseng, and Macadamia 

Nuts

Date: August 1, 2008

Sub-agency: Agricultural Marketing 

Service 

Action: Interim final requirements; 

request for comments

Exception(s) to NPRM cited: 

Good cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-1093R

The interim final rule implements 

requirements in the Farm Security and 

Rural Investment Act of 2002 (the 2002 

Farm Bill) and the Food, Conservation, 

and Energy Act of 2008 (the 2008 Farm 

Bill). This interim final rule requires 

retailers to notify customers of the 

country of origin of certain commodities 

including muscle cuts of beef, lamb, 

chicken, goat, and pork; ground beef, 

lamb, chicken, goat, and pork; 

perishable agricultural commodities; 

macadamia nuts; pecans; ginseng; and 

peanuts. 

USDA analyzed the costs and benefits of this 

interim final rule. USDA determined that the 

estimated benefits associated with this interim 

final rule are likely to be small, difficult to 

quantify, and accrue mainly to those 

consumers who desire country of origin 

information. USDA estimated that the first-year 

incremental costs for directly affected firms will 

be $2.5 billion and the overall net costs to the 

U.S. economy in the 10th year after 

promulgation to be $211.9 million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 50 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

11 Rule title: Direct and CounterCyclical Program and Average Crop 

Revenue Election Program

Date: December 29, 2008

Sub-agency: Commodity Credit 

Corporation

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report:

http://www.gao.gov/products/GAO-09

-890R

The final rule implements provisions of 

the 2008 Farm Bill regarding the direct 

and counter-cyclical payment program 

for the 2008 through 2012 crop years as 

well as the Average Crop Revenue 

Election (ACRE) program payments for 

the 2009 through 2012 crop years.

CCC performed a cost-benefit analysis in 

conjunction with the final rule. Overall, CCC 

estimates that the final rule will result in an 

increase of $487 million in average annual 

government outlays for the payments in fiscal 

years 2008 through 2012. Direct payments are 

projected to average $4.749 billion in fiscal 

years 2008 through 2014 for crop years 2008 

through 2012. These payments represent a 

decrease of about $0.484 billion each crop 

year compared with direct payments under the 

2002 Farm Bill. Counter-cyclical payments are 

projected to average $0.089 billion in FY 2008 

through 2014 for crop years 2008 through 

2012, which represents a decrease of $0.043 

billion compared with counter-cyclical 

payments under the 2002 Farm Bill. ACRE 

program payments are projected to average 

$1.014 billion each crop year. The final rule 

continues the policy of planting flexibility by 

decoupling the payments from the production 

decisions of individual farmers, and continues 

marketing assistance loan provisions at higher 

levels for some crops in some years.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 51 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

12 Rule title: Wetlands Reserve 

Program 

Date: January 15, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Interim final rule with request 

for comment

Exception(s) to NPRM cited:

Statutory

GAO major rule report:

http://www.gao.gov/products/GAO-09

-960R

The interim final rule sets forth how the 

Wetlands Reserve Program will be 

implemented in response to changes 

made by the 2008 Farm Bill and 

incorporates other changes for 

clarification or program administration 

improvement. Those changes include 

raising the enrollment cap to 3.04 

million acres through 2012, limiting 

program eligibility to private lands and 

acreage owned by Indian tribes, and 

determining the rate of compensation 

for easements of 30-year contracts 

enrolled in the program.

CCC prepared a cost-benefit analysis in 

conjunction with this interim final rule. The 

main program costs associated with the interim 

final rule are for the purchase of easements 

and wetland restoration expenses with the 

program. CCC stated that approximately 89.8 

percent of the Wetlands Reserve Program 

funding has been used for permanent 

easement projects, which have an associated 

fiscal year 2007 average per acre cost of 

$3,000, about 7.9 percent for 30-year 

easement projects, with a fiscal year 2007 

average per acre cost of almost $1,100, and 

2.4 percent for restoration cost-share 

agreement projects, with a fiscal year 2007 

average per acre cost of nearly $670.

The benefits associated with the interim final 

rule include creation of high-value wetlands, 

control of sheet and rill erosion as lands are 

converted from cropland to wetlands, creation 

and protection of habitat for fish and wildlife, 

improving water quality by filtering sediments 

and chemicals, and providing opportunities for 

educational, scientific, and recreational 

activities. According to CCC, many of the 

benefits are difficult to quantify. However, CCC 

was able to conclude that the monetary and 

non-monetary benefits from the Wetlands 

Reserve Program, as discussed in the interim 

final rule, can exceed total program costs.

13 Rule title: Environmental Quality 

Incentives Program

Date: January 15, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Interim final rule with request 

for comment

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-959R

The interim final rule amends the 

Environmental Quality Incentives 

Program (EQIP) to incorporate changes 

authorized by the 2008 Farm Bill. Those 

changes include extending EQIP’s 

implementation through Fiscal Year 

2012, providing payments for 

conservation practices related to 

organic production, providing an 

increased payment rate to historically 

underserved producers, and 

establishing a national target to set 

aside 5 percent of EQIP funds for 

socially disadvantaged farmers or 

ranchers and an additional 5 percent of 

EQIP funds for beginning farmers or 

ranchers.

CCC prepared a cost-benefit analysis in 

conjunction with this interim final rule. For 

purposes of the analysis, CCC compared the 

increased EQIP funding against previous 

levels of EQIP funding. CCC stated that the 

expanded funding will result in an estimated 

$10.4 in benefits over the period of fiscal year

2007 through 2012, with $0.8 billion 

attributable to improved animal waste 

management and $9.6 billion to land 

treatment. Estimated net benefits for that 

period were $57 million above total costs. 

Ultimately, CCC determined that the interim 

final rule will provide $18 million in additional 

net benefits due to the expansion of EQIP 

funds in the 2008 Farm Bill.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 52 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

14 Rule title: Mandatory Country of 

Origin Labeling of Beef, Pork, Lamb, 

Chicken, Goat Meat, Wild and FarmRaised Fish and Shellfish, Perishable 

Agricultural Commodities, Peanuts, 

Pecans, Ginseng, and Macadamia 

Nuts

Date: January 15, 2009

Sub-agency: Agricultural Marketing 

Service 

Action: Interim final rule with request 

for comment

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report:

http://www.gao.gov/products/GAO-09

-333R

The final rule implements provisions in 

the 2002 Farm Bill and 2008 Farm Bill 

that require retailers to notify their 

customers of the country of origin of 

covered commodities. Covered 

commodities include muscle cuts of 

beef (including veal), lamb, chicken, 

goat, and pork; ground beef, ground 

lamb, ground chicken, ground goat, and 

ground pork; wild and farm-raised fish 

and shellfish; perishable agricultural 

commodities; macadamia nuts; pecans; 

ginseng; and peanuts.

USDA conducted a cost-benefit analysis of this 

final rule. USDA concluded that the estimated 

economic benefits of this final rule are difficult 

to quantify but likely to be small. The estimated 

first-year incremental costs for growers, 

producers, processors, wholesalers, and 

retailers are $2.6 billion. The estimated cost to 

the United States economy in higher food 

prices and reduced food production in the 10th 

year after implementation of the final rule is 

$211.9 million.

15 Rule title: Sugar Program

Date: April 6, 2009

Sub-agency: Farm Service Agency 

and Commodity Credit Corporation

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-891R 

The final rule implements provisions in 

the 2008 Farm Bill administering 

changes to the sugar loan and sugar 

marketing allotment program through 

2012. The changes include new loan 

rates for raw cane sugar and beet 

sugar, new provisions to guarantee 

domestic suppliers an 85 percent 

market share, and revised procedures 

for granting allocations for new entrants. 

CCC prepared a cost-benefit analysis of this 

final rule. CCC states that this final rule 

implements two major changes in the sugar 

program resulting from the 2008 Farm Bill, 

higher loan rates and a guaranteed market 

share. CCC concludes that these are expected 

to have zero impact on federal costs for fiscal 

years 2009 and 2010 because baseline 

assumptions project fiscal year 2011 to be the 

first year of surplus sugar in the marketplace. 

However, over the course of fiscal years 2009 

through 2018, CCC concludes that federal net 

expenditures are expected to be $1.055 billion 

more than if the 2002 Farm Bill provisions 

were still in place. CCC also concludes that the 

loan rate increase is expected to increase 

sugar costs to consumers and sugar users by 

$1.4 billion from 2009 to 2018.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 53 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

16 Rule title: Marketing Assistance 

Loans and Loan Deficiency 

Payments

Date: April 7, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-892R

The final rule implements changes to 

the Marketing Assistance Loans (MAL) 

and Loan Deficiency Payments (LDP) 

programs for wheat, feed grains 

soybeans, other oilseeds, peanuts, 

pulse crops, honey, wool, and mohair. 

CCC is making these changes to 

comply with the 2008 Farm Bill. The 

legislation extended the MAL and LDP 

programs through 2012. This rule also 

provides separate rates for long and 

medium grain rice beginning in crop 

year 2008. 

CCC prepared a cost-benefit assessment of 

the changes made by this final rule. The 

assessment includes discussions of the 

statutorily-mandated and discretionary 

changes for the MAL and LDP programs. CCC 

expects the projected impacts from the use of 

its discretionary authority to be relatively minor. 

Projected outlays impacts were discussed in a 

cost-benefit analysis completed for a prior 

rulemaking. That analysis stated that the 

average annual change in government outlays 

for fiscal years 2008 to 2012 would be $487 

million. CCC determined that the impacts of 

the regulatory changes addressed in this final 

rule and the prior rule are inherently 

interrelated and therefore did not address the 

impact of the rules individually.

17 Rule title: Conservation Reserve 

Program 

Date: June 29, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Interim final rule with request 

for comments

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-271R

The interim rule amends the terms and 

conditions of enrolling acreage in the 

Conservation Reserve Program to 

implement provisions of the 2008 Farm 

Bill. This rule also updates other 

eligibility requirements to implement 

legislative changes.

CCC analyzed the costs and benefits of this 

interim rule. Based on estimates concerning 

the amount of land that will be eligible, 

assumed participation rates and annual 

enrollment, and estimated per-acre costs, CCC 

estimates the costs of implementing the 

changes considered in the interim rule will total 

$79.6 million through fiscal year 2012 and 

$191.2 million through fiscal year 2018, which 

averages to $19.1 million per year over 10 

years. According to CCC, the extent of 

environmental benefits derived from this rule 

will depend on participation rates and the 

specific conservation measures adopted. CCC 

offers the following examples of benefits: (1) 

tree thinning has the potential to enhance 

wildlife habitat, provide for carbon 

sequestration, and reduce the risk of wildfires; 

(2) enrollment of aquaculture ponds and 

flooded farmland and associated buffers can 

increase migratory waterfowl and other wildlife 

species populations, and potentially reduce 

flood damage, protect water quality, and 

provide for carbon sequestration; and (3) 

constructed wetlands and buffers can reduce 

nitrate loadings, reduce down-stream flood 

damages, and increase wildlife habitat.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 54 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

18 Rule title: Conservation Stewardship 

Program 

Date: July 29, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Interim final rule with request 

for comment

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-961R

This interim final rule implements 

changes to policies, procedures, and 

requirements necessary to implement 

the Conservation Stewardship Program 

as authorized by the 2008 Farm Bill.

The National Resources Conservation Service 

(NRCS) prepared a cost-effectiveness analysis 

(CEA) of this interim final rule. The CEA 

describes how financial assistance and 

technical assistance are made available 

through the Conservation Stewardship 

Program, with the program objective being to 

have producers adopt additional conservation 

activities. The CEA attempts to compare the 

impact of these activities in generating 

environmental benefits with program costs. 

Since the Conservation Stewardship Program 

is a voluntary program, it is not expected to 

impose any obligation or burden upon 

agricultural producers and non-industrial 

private forestland owners who chose not to 

participate.

19 Rule title: Farm Storage Facility 

Loan and Sugar Storage Facility 

Loan Programs

Date: August 18, 2009

Sub-agency: Commodity Credit 

Corporation

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-169R

The final rule amends the regulations 

governing the Farm Storage Facility 

Loan (FSFL) and Sugar Storage Facility 

Loan (SSFL) programs. The final rule 

implements changes from the 2008 

Farm Bill including adding hay and 

renewable biomass as eligible FSFL 

commodities, extending the maximum 

loan term to 12 years, and increasing 

the maximum loan amount to $500,000. 

The final rule also adds fruits and 

vegetables (including nuts) as eligible 

facility loan commodities and adds cold 

storage facilities as eligible facilities.

CCC prepared a cost-benefit analysis in 

conjunction with the final rule. CCC determined 

that the changes to the FSFL program will add 

costs of $6 million in 2009, $28 million in 2010, 

$30 million in 2011, and $32 million in 2012 

over the cost of the existing program. If the full 

costs of the program are considered, rather 

than the changes made by the final rule, the 

financial impact will be over $100 million per 

year.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 55 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

20 Rule title: Livestock Forage Disaster 

Program and Emergency Assistance 

for Livestock, Honeybees, and FarmRaised Fish; Supplemental 

Agricultural Disaster Assistance

Date: September 11, 2009

Sub-agency: Farm Service Agency

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-272R

The final rule implements requirements 

for the Emergency Assistance for 

Livestock, Honeybees, and FarmRaised Fish Program (ELAP) and the 

Livestock Forage Disaster Program 

(LFP) authorized by the 2008 Farm Bill. 

LFP provides payments to eligible 

livestock producers that have suffered 

livestock grazing losses due to 

qualifying drought or fire. ELAP 

provides emergency assistance to 

eligible producers of livestock, 

honeybees, and farm-raised fish that 

have losses due to disease, adverse 

weather, or other conditions, including 

losses due to blizzards and wildfires. 

This rule specifies how LFP and ELAP 

payments are calculated, what losses 

are eligible, and when producers may 

apply for payments.

FSA analyzed the costs and benefits of this 

final rule. FSA estimates that the ELAP is likely 

to result in costs of the entire authorized $50

million per year each year, providing benefits 

of $50 million each year to producers of 

livestock, honeybees, and farm-raised fish. 

The benefits of the honeybee loss 

compensation aspect of the program could 

also include substantial indirect benefits to the 

agricultural sector as a whole, because 

honeybees pollinate more than $14 billion 

worth of fruits, vegetables, and other crops in 

the United States. The honeybee portion of the 

program is expected to be the most expensive 

part of ELAP, due to losses resulting from 

colony collapse disorder. The LFP is expected 

to cost about $409 million per year, providing 

the same amount in benefits to livestock 

producers. The indirect benefit of the program 

is to reduce income variability of livestock 

producers due to drought and fire losses 

beyond their control.

21 Rule title: Dairy Economic Loss 

Assistance Payment Program

Date: December 21, 2009

Sub-agency: Farm Service Agency

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-397R

The final rule implements the new Dairy 

Economic Loss Assistance Payment 

(DELAP) program, which will assist 

dairy producers by providing payments 

to producers who produced and 

marketed milk in the United States at 

some time from February through July 

2009. The payments are intended to 

offset a portion of the dairy producers’ 

losses resulting from milk prices that 

were far below production costs.

FSA prepared a cost-benefit analysis in 

conjunction with the final rule. FSA expects 

that the DELAP program will provide $290 

million in payments to dairy producers during 

fiscal year 2010, which represents both the 

cost of the program and the benefit to the 

participants. All payments under the program 

are expected to be made in fiscal year 2010.

The DELAP program provides payment to 

dairy producers in fiscal year 2010 based on 

production in February through July 2009. FSA 

does not expect that the final rule will result in 

a significant change in the price of milk for 

consumers, because it is not subsidizing the 

cost of current production or providing price 

support.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 56 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

22 Rule title: Supplemental Revenue 

Assistance Payments Program

Date: December 28, 2009

Sub-agency: Farm Service Agency

Action: Interim final rule; solicitation 

of comments

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-398R

The final rule implements requirements 

for the new Supplemental Revenue 

Assistance Payments Program (SURE) 

authorized by the 2008 Farm Bill. SURE 

provides disaster assistance to eligible 

participants who have experienced 

qualifying crop production losses or 

crop quality losses, or both, occurring in 

crop year 2008 through September 30, 

2011.

FSA prepared a cost-benefit analysis in 

conjunction with the final rule. FSA expects 

that payments from the SURE Program for 

2008 through 2011 will total $3.4 billion, an 

average of $0.85 billion per crop year, which 

represents both the cost of the program and 

the benefit to the participants. FSA states that 

this is less than the average of $1.14 billion per 

year for previous ad hoc crop disaster 

programs from 1998 to 2007. The overall costs 

for SURE are expected to be less than the cost 

of previous ad hoc programs for several 

reasons. First, unlike ad hoc disaster 

programs, SURE, in general, is additional 

compensation for established losses under 

crop insurance or noninsured crop disaster 

assistance program (NAP), and is not a benefit 

that replaces or duplicates previously received 

crop insurance or NAP payments. Additionally, 

SURE payments are based on farm revenue 

losses, rather than losses in particular crops or 

individual units; therefore, participants with 

losses in one crop but not others may or may 

not qualify for a SURE payment. Finally, the 

SURE guarantee cap is 90 percent of 

expected revenue, while previous programs 

had a cap of 95 percent of normal crop value.

23 Rule title: Conservation Stewardship 

Program 

Date: June 3, 2010

Sub-agency: Commodity Credit 

Corporation,

Natural Resources Conservation 

Service 

Action: Final rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-832R

The final rule makes changes to the 

Conservation Stewardship Program. 

The program provides financial and 

technical assistance to eligible 

producers to conserve and enhance 

soil, water, air, and related natural 

resources on their land, which can 

include cropland, grassland, rangeland, 

non-industrial private forest, and 

agricultural land under the jurisdiction of 

an Indian tribe.

CCC prepared a cost-effectiveness analysis 

(CEA) of the final rule, which is an approach 

used when benefits are not well understood or 

difficult to measure, but activity costs are 

available. The CEA compares the impact of 

these conservation activities in generating 

environmental benefits with program costs. 

The CEA describes how the improvements can 

produce beneficial impacts concerning onsite 

resource conditions, such as conserving soil, 

and significant offsite benefits, such as cleaner 

water, improved air quality, and enhanced 

wildlife habitat. The total cumulative program 

costs for four program ranking periods are 

estimated to be $2.99 billion in constant 2005 

dollars, discounted at 7 percent, or $3.52 

billion in constant 2005 dollars discounted at 3 

percent. Since the Conservation Stewardship 

Program is a voluntary program, it is not 

expected to impose any obligation or burden 

upon agricultural producers and non-industrial 

private forestland owners who chose not to 

participate.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 57 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

24 Rule title: Conservation Reserve 

Program 

Date: July 28, 2010

Sub-agency: Commodity Credit 

Corporation

Action: Interim rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-991R

The interim rule amends the 

Conservation Reserve Program (CRP) 

to implement provisions of the 2008 

Farm Bill, including extending CRP 

through 2012 and making some 

changes in eligibility requirements. The 

purpose of CRP is to cost-effectively 

assist producers in conserving and 

improving soil, water, wildlife, and other 

natural resources by converting 

environmentally-sensitive acreage from 

the production of agricultural 

commodities to a long-term vegetative 

cover and to address issues raised by 

state, regional, and national 

conservation initiatives.

CCC states that the changes to CRP in this 

rule are expected to cost about $6.7 million per 

year over 10 years (2011–2020). CCC 

explains that this is a net cost that reflects 

roughly $77 million in additional CRP 

payments to participants over the next 10 

years for additional land enrolled through the 

county maximum acreage waivers to exclude 

certain acreage and revised cropping history 

requirements and payments for pollinator 

habitat practices, minus roughly $10 million in 

reduced payments for the revised permissive 

uses. CCC states that the benefits to 

participants will be the net additional $6.7 

million per year over the next 10 years. CCC 

notes that there are expected to be additional 

non-quantifiable environmental benefits from 

the waivers to exclude that will allow more 

environmentally sensitive acres to be enrolled 

through continuous signup, from additional 

highly erodible land enrollment that could 

result from making land in long-term hay 

rotations eligible, and from the incentives for 

pollinator habitat. Additionally, CCC states that 

the other provisions in this rule, such as local 

preference, are expected to have little to no 

cost. CCC believes that these provisions will 

largely substitute one CRP participant for 

another or one practice for another, leading in 

a shift in costs and benefits to different 

participants and practices, but little net cost or 

benefit for CRP as a whole. 

25 Rule title: Crop Assistance Program

Date: October 25, 2010

Sub-agency: Farm Service Agency

Action: Interim rule

Exception(s) to NPRM cited: Good 

cause; matter relating to public 

property, loans, grants, benefits, or 

contracts

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-175R

The interim rule provides emergency 

assistance to reestablish the purchasing 

of rice, cotton, soybeans, and sweet 

potatoes in specified counties for which 

a disaster designation was issued 

based on excessive moisture and 

related conditions for the 2009 crop 

year. This rule specifies the eligibility 

requirements, payment calculations, 

and application procedures for the Crop 

Assistance Program, which will provide 

up to $550 million to eligible producers.

FSA analyzed the costs and benefits of this 

interim rule. FSA estimated that the total cost 

to the government, and the corresponding 

benefit to producers, for the Crop Assistance 

Program will be between $137 million and 

$543 million, depending on how many 

producers in disaster counties apply for 

payment.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 58 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Commerce

26 Rule title: Public Safety 

Interoperable Communications 

(PSIC) Grant Program

Date: July 23, 2007

Sub-agency: National 

Telecommunications and Information 

Administration (NTIA)

Action: Notice of Availability of 

Funds

Exception(s) to NPRM cited: Matter 

relating to public property, loans, 

grants, benefits or contracts

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-1141R

The final rule implements a $1 billion 

grant program to assist public safety 

agencies in the acquisition of, 

deployment of, or training for the use of 

interoperable communications systems 

that utilize—or enable interoperability 

with communications systems that can 

utilize—reallocated public spectrum for 

radio communications. This grant 

program was authorized by the Deficit 

Reduction Act of 2005 and the Call 

Home Act of 2006. This is a one-time 

transfer program where funds will be 

awarded no later than September 30, 

2007. 

The final rule implements a grant program that 

will make $968.39 million available in grant 

awards. This is a one-time transfer program 

where funds will be awarded no later than 

September 30, 2007.

27 Rule title: Amendments to the 

Digital-to-Analog Converter Box 

Program to Implement the DTV Delay 

Act 

Date: March 12, 2009

Sub-agency: National 

Telecommunications and Information 

Administration

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-502R

The final rule implements changes to 

the Digital-to-Analog Converter Box 

Program Coupon Program to conform to 

the DTV Delay Act which extended the 

deadline for the digital conversion and 

the coupon application period by four 

months. The final rule also provided 

NTIA additional flexibility in how it 

distributes coupons to households, so 

that NTIA is no longer required to 

distribute coupons via the United States 

Postal Service. The final rule also 

permits NTIA to prioritize the distribution 

of coupons to over-the-air only 

households in the event that a waiting 

list becomes necessary.

NTIA prepared a cost-benefit analysis in 

conjunction with this final rule. As a baseline, 

NTIA considered the effects if there were no 

extension of the DTV Converter Box Coupon 

Request Deadline. NTIA noted that its waiting 

list contained more than 4.2 million coupon 

requests, and that those combined 

households, without the extension, would incur 

a total cost exceeding $210 million if they had 

to purchase converter boxes without the 

coupon subsidy. NTIA also cited a Nielson 

Company study indicating that, as of February 

18, 2009, more than 5 million households were 

fully unprepared for the transition to fully digital 

broadcasting, with the highest lack of 

preparation among viewers under 35 years 

old, African American and Hispanic 

households. The total costs to these 

households of purchasing a converter box 

without subsidy would be $250 million.

NTIA notes that enactment of the DTV Delay 

Act and the ARRA reflect a commitment to 

assisting eligible households in retaining 

access to broadcast television programming 

following the digital television conversion. 

Consistent with its responsibility to administer 

the Coupon Program to achieve this goal, 

NTIA’s final rule seeks to expedite coupon 

distribution as effectively and efficiently as 

possible. Therefore, NTIA concluded the 

benefits of the final rule exceed its costs and 

NTIA supported adoption of the final rule to 

facilitate the digital transition for America’s 

families.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 59 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

28 Rule title: State Broadband Data and 

Development Grant Program

Date: July 8, 2009

Sub-agency: National 

Telecommunications and Information 

Administration

Action: Notice of funds availability 

(Notice) and solicitation of 

applications.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-321R

The notice announces the availability of 

funds pursuant to the American 

Recovery and Reinvestment Act of 

2009 and the Broadband Data 

Improvement Act for the State 

Broadband Data and Development 

Grant Program. The Program is a 

competitive, merit-based matching grant 

program that funds projects that collect 

comprehensive and accurate state-level 

broadband mapping data, develops 

state-level broadband maps, aids in the 

development and maintenance of a 

national broadband map, and funds 

statewide initiatives directed at 

broadband planning.

NTIA did not prepare a cost-benefit analysis in 

conjunction with this final rule. However, the 

final rule states that the program will make 

approximately $240 million available for 

eligible entities to develop and implement 

statewide initiatives to identify and track the 

availability and adoption of broadband services 

within each state.

Department of Defense (DOD)

29 Rule title: Homeowners Assistance 

Program—Application Processing

Date: September 30, 2009

Sub-agency: Office of the Secretary

Action: Interim final rule

Exception(s) to NPRM cited: Other 

reason

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-422R

The interim final rule expands the 

Homeowners Assistance Program 

(HAP) to provide assistance to wounded 

members of the Armed Forces (30 

percent or greater disability), surviving 

spouses of fallen warriors, wounded 

DOD civilian homeowners reassigned in 

furtherance of medical treatment or 

rehabilitation or due to retirement in 

connection with their disability.

The rule did not include estimates of the costs, 

benefits, or transfer amounts.

30 Rule title: Retroactive Stop Loss 

Special Pay Compensation

Date: October 23, 2009

Sub-agency: Office of the Secretary

Action: Interim final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-415R

The interim final rule provides for 

retroactive stop loss special pay as 

authorized and appropriated by the 

Supplemental Appropriations Act of 

2009.

The Supplemental Appropriations Act, 2009 

appropriated $534. 4 million to DOD, to remain 

available for obligation until expended for the 

payment of claims specified by this law. 
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 60 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

31 Rule title: Retroactive Stop Loss 

Special Pay Compensation

Date: April 16, 2010

Sub-agency: Office of the Under 

Secretary of Defense for Personnel 

and Readiness

Action: Final rule

Exception(s) to NPRM cited: Good 

cause; other reason

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-683R

The final rule provides for retroactive 

stop loss special pay as authorized and 

appropriated in the Supplemental 

Appropriations Act of 2009.

The Supplemental Appropriations Act, 2009 

appropriated $534.4 million to DOD, to remain 

available for obligation until expended: 

provided that such funds shall be available to 

the secretaries of the military departments only 

to make payment of claims specified by this 

law.

32 Rule title: Homeowners Assistance 

Program—Application Processing

Date: November 16, 2010

Sub-agency: Office of the Deputy 

Under Secretary of Defense

Action: Final rule

Exception(s) to NPRM cited: Other 

reason

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-222R

The final rule continues to authorize the 

Homeowners Assistance Program 

(HAP) to financially compensate eligible 

military and civilian federal employee 

homeowners when the real estate 

market is adversely affected directly 

related to the closure or reduction-inscope of operations due to Base 

Realignment and Closure (BRAC). The 

American Recovery and Reinvestment 

Act of 2009 expanded the HAP to 

provide assistance to: wounded 

members of the Armed Forces (30 

percent or greater disability), surviving 

spouses of fallen warriors, and 

wounded DOD civilian homeowners 

reassigned in furtherance of medical 

treatment or rehabilitation or due to 

medical retirement in connection with 

their disability; BRAC 2005 impacted 

homeowners relocating during the 

mortgage crisis; and service member 

homeowners undergoing Permanent 

Change of Station moves during the 

mortgage crisis.

The rule did not include estimates of the costs, 

benefits, or transfer amounts. 
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 61 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Education (Education)

33 Rule title: Federal Student Aid 

Programs 

Date: August 9, 2006

Sub-agency: Office of 

Postsecondary Education

Action: Interim final regulations; 

request for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-06

-1063R

The interim final rule amends the 

Federal Student Aid Program to 

implement changes made by the Higher 

Education Reconciliation Act of 2005.

Education states that the interim final rule will 

impose increased costs on some borrowers, 

such as an increase in the loan interest rate for 

Federal Family Education Loans PLUS 

borrowers, the elimination of in-school and 

joint consolidation loans, and the mandatory 

imposition of the previously optional 1-percent 

guaranty agency default insurance premium. 

Education estimates that the annualized 

monetary transfers from the federal 

government to postsecondary students and 

from student aid program participants to the 

federal government will be $976 million.

34 Rule title: Federal Perkins Loan 

Program, Federal Family Education 

Loan Program, and William D. Ford 

Federal Direct Loan Program

Date: November 1, 2007

Sub-agency: Office of 

Postsecondary Education

Action: Final Regulations

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-293R

The final rule makes a number of 

changes to the federal loan programs 

authorized under title IV of the Higher 

Education Act of 1965 to strengthen and 

improve the administration of the 

programs. This final rule also 

incorporates changes enacted in the 

College Cost Reduction and Access Act 

(CCRAA). 

Education analyzed the costs and benefits of 

this final rule. Education determined that, of 

the regulatory changes in this final rule not 

implementing the CCRAA, only the mandatory 

assignment of defaulted Perkins Loans will 

have a substantial economic effect, with an 

impact of approximately $23 million annually.

Education estimates that the provisions of this 

final rule implementing CCRAA which reduce 

costs will decrease federal costs by $23.3 

billion over fiscal years 2007 to 2012. The 

Department also estimates that the provisions 

of this final rule implementing CCRAA which 

expand benefits will increase federal costs by 

$5.9 billion over fiscal years 2007 to 2012.

35 Rule title: Federal Perkins Loan 

Program, Federal Family Education 

Loan Program, and William D. Ford 

Federal Direct Loan Program

Date: October 23, 2008

Sub-agency: Office of 

Postsecondary Education

Action: Final regulations

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-191R

The final rule amends the regulations 

governing the Federal Perkins Loan 

Program, the Federal Family Education 

Loan Program, and the William D. Ford 

Federal Direct Loan Program. This final 

rule implements various provisions of 

the College Cost Reduction and Access 

Act, including the establishment of the 

Income-Based Repayment plan and the 

Public Service Loan Forgiveness 

Program. 

Education analyzed the costs and benefits of 

this final rule. Education estimates that the 

parts of this final rule that implement provisions 

of the College Cost Reduction and Access Act 

(CCRAA) will have a net budget impact of 

$650 million in 2008 and $9.2 billion over fiscal 

years 2008 to 2012.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 62 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

36 Rule title: Student Assistance 

General Provisions; Teacher 

Education Assistance for College and 

Higher Education (TEACH) Grant 

Program; Federal Pell Grant 

Program; Academic Competitiveness 

Grant Program and National Science 

and Mathematics Access To Retain 

Talent Grant Program

Date: May 1, 2009

Sub-agency: Office of 

Postsecondary Education

Action: Interim final rule; request for 

comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-756R

The interim final rule implements 

changes to the Academic 

Competitiveness Grant (ACG) and 

National Science and Mathematics 

Access to Retain Talent Grant (National 

SMART Grant) programs. As required 

by recent amendments to the Higher 

Education Act of 1965, the interim final 

rule makes ACGs and National SMART 

Grants available to eligible non-citizens 

and students enrolled at least half-time 

and provides that maximum awards for 

part-time students be proportionally 

reduced consistent with the 

requirements in the Federal Pell Grant 

Program and that grant awards be 

based on a student’s grade level rather 

than academic year. 

Education prepared an accounting statement 

showing the classification of the expenditures 

associated with the interim final rule. The 

Department estimates that the interim final rule

will increase federal grant payments to 

students by $448 million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 63 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

37 Rule title: General and Non-loan 

Programmatic Issues

Date: October 29, 2009

Sub-agency: Office of 

Postsecondary Education

Action: Final regulations

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-238R

The final regulations implemented 

legislative changes to various general 

and non-loan provisions for institutional 

eligibility under the Higher Education 

Act of 1965, the Student Assistance 

General Provisions, the Federal WorkStudy (FWS) Programs, the Teacher 

Education Assistance for College and 

Higher Education (TEACH) Grant 

Program, the Federal Pell Grant 

Program, and the Leveraging 

Educational Assistance Partnership 

Program (LEAP).

Education has assessed the potential costs 

and benefits and determined that the benefits 

justify the costs. Education states that benefits 

include greater transparency about consumer 

information and campus safety for prospective 

and current students at institutions 

participating in the federal student financial 

assistance programs, copyright infringement 

policies, requirements for readmission of 

service members, explanation of extenuating 

circumstances under which TEACH Grant 

service obligations may be excused, 

requirements for programs serving students 

with intellectual disabilities, and additional 

guidelines for federal grant and work-study 

programs. Education states that costs include 

requiring regulated entities to develop new 

disclosures and other materials, as well as 

accompanying dissemination processes in 

order to implement the statutory provisions. 

These changes are estimated to increase 

burden on entities or individuals participating in 

the federal student assistance programs by 

253,718 hours. According to Education, 

virtually all of the increased burden is 

associated with institutions. A small amount, 

384 hours, is associated with students. The 

monetized cost of this additional burden, using 

loaded wage data developed by the Bureau of 

Labor Statistics, is $4.7 million.

[Education also estimated that this rule would 

result in annualized monetized transfers from 

the government to student loan borrowers of 

$281 million (7 percent discount rate) or $277 

million (3% discount rate).]
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 64 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

38 Rule title: Student Assistance 

General Provisions; Teacher 

Education Assistance for College and 

Higher Education (TEACH) Grant 

Program; Federal Pell Grant 

Program; Academic Competitiveness 

Grant Program and National Science

and Mathematics Access To Retain 

Talent Grant Program

Date: November 23, 2009

Sub-agency: Office of 

Postsecondary Education

Action: Final regulations

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-427R 

The final rule adopts regulations for the 

Academic Competitiveness and 

National Science and Mathematics to 

Retain Talent Grant programs; Student 

Assistance General Provisions; Federal 

Pell Grant Program; and Teacher 

Education Assistance for College and 

Higher Education Grant Program. This 

rule implements provisions of the Higher 

Education Act of 1965, as amended by 

the Ensuring Continued Access to 

Student Loans Act of 2008 and the 

Higher Education Opportunity Act of 

2008.

Education estimates that this final rule will 

result in 538,000 additional awards totaling 

$448 million over award years 2009 through 

2010 and 2010 through 2011. These changes 

will increase federal costs by the same 

amount.

39 Rule title: Race to the Top Fund

Date: April 2, 2010

Sub-agency: N/A

Action: Interim final requirements; 

request for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-641R

The interim final rule amends the Race 

to the Top Fund requirements to 

establish the suggested budget ranges 

as mandatory funding limits for Phase 2 

of the competition.

Education determined that this interim final rule 

will not impose additional costs to state 

applicants, grantees, or the federal 

government. A state applicant may take 

additional time to create or revise its Race to 

the Top budget so that it conforms to the 

required budget range if the state had intended 

to request more than the maximum in the 

range. However, Education believes that the 

benefits outweigh any potential burden that the 

interim final rule may cause.

Department of Energy

40 Rule title: Advanced Technology 

Vehicles Manufacturing Incentive 

Program 

Date: November 12, 2008

Sub-agency: Office of the Chief 

Financial Officer

Action: Interim final rule; request for 

comment

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-196R

The interim final rule establishes the 

Advanced Technology Vehicles 

Manufacturing Incentive Program 

authorized by statute, which provides 

for loans and grants to eligible 

automobile manufacturers and 

component suppliers for projects that 

reequip, expand, and establish 

manufacturing facilities in the United 

States to produce light-duty vehicles 

and provide improvements in fuel 

economy performance beyond certain 

specified levels. 

The Consolidated Security, Disaster 

Assistance, and Continuing Appropriations Act 

of 2009 appropriated $7.5 billion for the 

‘‘Advanced Technology Vehicles 

Manufacturing Loan Program Account’’ for the 

cost of direct loans and states that 

commitments for direct loans using such 

amounts shall not exceed $25 billion in total 

loan principal, and $10 million for DOE’s 

administrative expenses for implementing the 

program.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 65 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Health and Human 

Services (HHS)

41 Rule title: Medicare Program; 

Physician Fee Schedule Update for 

Calendar Year 2003

Date: February 28, 2003

Sub-agency: Centers for Medicare & 

Medicaid

Services (CMS)

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-03

-533R

The final rule revises the estimates 

used to establish the sustainable growth 

rates for fiscal years 1998 and 1999 for 

the purposes of determining future 

updates to the physician fee schedule. It 

also announces a 1.6-percent increase 

in the calendar year 2003 physician fee 

schedule conversion factor for March 1, 

2003, to December 31, 2003. 

CMS estimates that the changes to the 

physician fee schedule update will increase 

Medicare expenditures for physicians’ services 

by $1.1 billion in fiscal year 2003, $2 billion in 

fiscal year 2004, and $2.8 billion in fiscal year 

2005 or an estimated $15.7 billion over 5 years 

and $49.6 billion over 10 years.

42 Rule title: Medicare Program; 

Changes to Medicare Payment for 

Drugs and Physician Fee Schedule 

Payments for Calendar Year 2004

Date: January 7, 2004

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Interim final rule with request 

for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-04

-373R

The interim final rule implements 

provisions of the Medicare Prescription 

Drug, Improvement, and Modernization 

Act of 2003 that are applicable in 2004 

to Medicare payments for covered 

drugs and physician fee schedule 

services.

CMS estimates that the changes contained in 

the interim final rule regarding the physician 

fee schedule and drug payment rates to 

increase Medicare spending by more than $1 

billion in fiscal year 2004.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 66 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

43 Rule title: Medicare Program; Health 

Care Infrastructure Improvement 

Program; Selection Criteria of Loan 

Program for Qualifying Hospitals 

Engaged in Cancer-Related Health 

Care

Date: September 30, 2005

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause; matter relating to public 

property, loans, grants, benefits, or 

contracts

GAO major rule report: 

http://www.gao.gov/products/GAO-06

-153R

The interim final rule sets forth the 

criteria for a loan program for qualifying 

hospitals engaged in research in the 

causes, prevention, and treatment of 

cancer as specified in the Medicare 

Prescription Drug, Improvement, and 

Modernization Act of 2003. The rule 

establishes a loan application process 

by which qualifying hospitals may apply 

for a loan for the capital costs of health 

care infrastructure improvement 

projects.

The interim final rule has $142 million available 

for the loan program from July 1, 2004, 

through September 30, 2008. No more than $2 

million may be used for the administration of 

the program during that time period.

44 Rule title: Medicare Program; 

Hospital Outpatient Prospective 

Payment System and CY 2007 

Payment Rates; CY 2007 Update to 

the Ambulatory Surgical Center 

Covered Procedures List; Medicare 

Administrative Contractors; and 

Reporting Hospital Quality Data for 

FY 2008 Inpatient Prospective 

Payment System Annual Payment 

Update Program—HCAHPS Survey, 

SCIP, and Mortality

Date: November 24, 2006

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Final rule with comment 

period and final rule

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-249R

The final rule revises the Medicare 

hospital outpatient prospective payment 

system to implement applicable 

statutory requirements and changes 

arising from CMS’s continuing 

experience with the system, including 

changes to the amounts and factors 

used to determine Medicare’s 

payments. The final rule also revises 

the current list of procedures that are 

covered when furnished in a Medicareapproved ambulatory surgical center 

and the emergency medical screening 

requirements for critical access 

hospitals.

CMS estimates that the changes made by the 

final rule will increase Medicare expenditures 

for calendar year 2007 over the expenditures 

for calendar year 2006 by $2.24 billion.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 67 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

45 Rule title: Medicare Program; 

Inpatient Psychiatric Facilities 

Prospective Payment System 

Payment Update for Rate Year 

Beginning July 1, 2007 (RY 2008)

Date: May 4, 2007

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-864R

This notice updates the prospective 

payment rates for Medicare inpatient 

psychiatric facilities (IPF). The changes 

are applicable to IPF discharges 

occurring during the year beginning July 

1, 2007, through June 30, 2008.

According to CMS’s estimate, the rate changes 

under this notice will increase payments by 

approximately $130 million.

46 Rule title: Medicaid Program; 

Citizenship Documentation 

Requirements

Date: July 13, 2007

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-1112R

The final rule implements the statutory 

requirement that states obtain 

satisfactory documentary evidence of a 

Medicaid applicant’s or recipient’s 

citizenship and identity.

CMS concluded that this rule will result in $80 

million less spent by the federal government 

and $60 million less spent by state 

governments per year for the next 5 years. 

Because the total is greater than $100 million 

per year, this is a significant rule. The 

regulatory impact statement did not account for 

the administrative costs on the states. With 

respect to administrative costs, CMS states 

that it provides federal match for administrative 

expenditures. CMS expects states to 

experience higher administrative costs during 

the first year of implementation as they adjust 

to the new requirements and expects these 

costs to decrease in later years as current 

recipients meet the requirements and only new 

applicants are required to submit 

documentation.

47 Rule title: Medicare Program; 

Prospective Payment System and 

Consolidated Billing for Skilled 

Nursing Facilities for FY 2008

Date: August 3, 2007

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Final rule

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-1181R

The final rule updates the payment 

rates used under the prospective 

payment system for skilled nursing 

facilities (SNF) for fiscal year 2008. In 

addition, the final rule revises and 

rebases the SNF market basket and 

modifies the threshold for the 

adjustment to account for market basket 

forecast error.

CMS estimates that the impact of the final rule 

will be to increase payments to SNFs by 

approximately $690 million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 68 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

48 Rule title: Medicare Program; 

Changes to the Hospital Inpatient 

Prospective Payment Systems and 

Fiscal Year 2008 Rates

Date: August 22, 2007

Sub-agency: Centers for Medicare & 

Medicaid

Services 

Action: Final rule with comment 

period

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-1200R 

The final rule revises the Medicare 

hospital inpatient prospective payment 

system for operating and capital-related 

costs. These changes arise from CMS’s 

continuing experience with these 

systems and implement provisions of 

three statutes. The rule sets limits on 

the rate of increase for certain hospitals 

and hospital units that are excluded 

from the inpatient prospective payment 

system.

CMS determined that this rule will result in an 

approximately $3.8 billion increase in fiscal 

year 2008 operating and capital payments.

49 Rule title: Medicare Program; 

Medicare Part B Monthly Actuarial 

Rates, Premium Rate, and Annual 

Deductible Medicare Program; 

Medicare Part B Monthly Actuarial 

Rates, Premium Rate, and Annual 

Deductible Beginning January 1, 

2008

Date: October 5, 2007

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/decisions/majrule

/d08176r.pdf

The notice announces the monthly 

actuarial rates for aged and disabled 

enrollees for the Part B Medicare 

Supplementary Medical Insurance) trust 

fund for January 1, 2008. It also 

announces the monthly Part B premium 

to be paid by aged and disabled 

beneficiaries, as well as the incomerelated monthly adjustment amounts to 

be paid by beneficiaries with modified 

adjusted gross income above certain 

threshold amounts.

A cost-benefit analysis was not conducted 

because the increases were statutorily 

directed. CMS did estimate that the increase 

will cost approximately 41.5 million Part B 

enrollees about $1.4 billion for 2008.

50 Rule title: Medicare Program; 

Inpatient Hospital Deductible and 

Hospital and Extended Care Services 

Coinsurance Amounts for Calendar 

Year 2008

Date: October 5, 2007

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-175R

The notice announces the inpatient 

hospital deductible and the hospital and 

extended care service coinsurance 

amounts for services furnished in 

calendar year 2008 under Medicare 

Part A. The statute specifies the 

formulae used to determine these 

amounts.

A cost-benefit analysis was not conducted 

because the increases were statutorily 

directed. CMS did estimate that the total 

increase in cost to beneficiaries associated 

with the notice to be approximately $870 

million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 69 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

51 Rule title: Medicare Program; 

Revisions to Payment Policies Under 

the Physician Fee Schedule, and 

Other Part B Payment Policies for CY 

2008; Revisions to the Payment 

Policies of Ambulance Services 

Under the Ambulance Fee Schedule 

for CY 2008; and the Amendment of 

the E-Prescribing Exemption for 

Computer Generated Facsimile 

Transmissions

Date: November 27, 2007

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-308R

The final rule makes changes to the 

Medicare Part B payment policy to 

implement provisions of the Tax Relief 

and Health Care Act of 2006. The 

changes are intended to ensure that 

payment systems are updated to reflect 

changes in medical practice and the 

relative value of services. The rule also 

finalizes the calendar year 2007 interim 

relative value units (RVU) and issues 

interim RVUs for new and revised 

procedure codes for calendar year 

2008. Finally, the rule announces that 

(1) the physician fee schedule update 

for calendar year 2008 is negative 10.1 

percent, (2) the initial estimate for the 

sustainable growth rate for calendar 

year 2008 is negative 0.1 percent, and 

(3) the conversion factor (CF) for 

calendar year 2008 is $34.0682.

CMS prepared a regulatory impact analysis of 

the final rule that concludes that the final rule 

will have an impact of reducing program 

expenditures by $6 billion and a $140 million 

increase in payments for ambulance services 

over calendar year 2007.

52 Rule title: Medicare Program: 

Changes to the Hospital Outpatient 

Prospective Payment System and CY 

2008 Payment Rates, the Ambulatory 

Surgical Center Payment System and 

CY 2008 Payment Rates, the 

Hospital Inpatient Prospective 

Payment System and FY 2008 

Payment Rates; and Payments for 

Graduate Medical Education for 

Affiliated Teaching Hospitals in 

Certain Emergency Situations 

Medicare and Medicaid Programs:

Hospital Conditions of Participation; 

Necessary Provider Designations of 

Critical Access Hospitals

Date: November 27, 2007

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Interim and final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-309R

The final rule revises the Medicare 

hospital outpatient prospective payment 

system to implement statutory 

requirements and changes arising from 

CMS’s continuing experience with the 

system, including changes to the 

amounts and factors used to determine 

Medicare’s payments. The final rule 

sets forth the applicable relative 

payment weights and amounts for 

services furnished in Ambulatory 

Surgical Centers (ASC). The final rule 

also includes changes made to the 

2008 hospital inpatient provider 

payment system as required by statute. 

Finally, CMS has included an interim 

final rule modifying the regulations 

relating to graduate medical education 

payments made to teaching hospitals 

that have Medicare affiliation 

agreements for certain emergency 

situations.

CMS estimates that the changes made by the 

final rule changing the outpatient prospective 

payment system (OPPS) payment rates will 

increase Medicare expenditures for calendar 

year 2008 over the expenditures for calendar 

year 2007 by $3.4 billion. The changes made 

to the ASC payment system are expected to 

have no net effect on Medicare expenditures in 

calendar year 2008. CMS estimates that the 

changes in inpatient prospective payment 

system (IPPS) payment rates will increase 

Medicare payments to IPPS providers for 

calendar year 2008 over the expenditures for 

calendar year 2007 by $4.635 billion.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 70 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

53 Rule title: Medicaid Program; 

Optional State Plan Case 

Management Services

Date: December 4, 2007

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/decisions/majrule

/d08378r.pdf 

The interim final rule revises current 

Medicaid regulations concerning case 

management and targeted case 

management services. The interim final 

clarifies the situations in which Medicaid 

will pay for case management activities. 

CMS prepared a cost-benefit analysis in 

conjunction with the interim final rule with 

comment period. CMS estimates that between 

fiscal years 2008 and 2012, the regulation will 

reduce federal Medicaid spending on case 

management and targeted case management 

services by $1.28 billion and increase federal 

spending on title IV-E foster care services by 

$369 million.

54 Rule title: Medicare Program; 

Standards for E-Prescribing Under 

Medicare Part D and Identification of 

Backward Compatible Version of 

Adopted Standard for E-Prescribing 

and the Medicare Prescription Drug

Program (Version 8.1)

Date: April 7, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-690R

The final rule adopts uniform standards 

required by statute for medication 

history, formulary and benefits, and fill 

status notification (RxFill) for the 

Medicare Part D electronic prescribing 

(e-prescribing) drug program. The final 

rule also adopts the National Provider 

Identifier (NPI) as a standard for 

identifying health care providers in eprescribing transactions. It also finalizes 

an interim final rule that identified the 

National Council for Prescription Drug 

Programs (NCPDP) Prescriber/ 

Pharmacist Interface SCRIPT standard 

as a backward compatible update of the 

NCPDP SCRIPT 5.0 until April 1, 2009.

CMS performed a cost-benefit analysis of the 

final rule. CMS contends that prescribers and 

dispensers that are now e-prescribing have 

already largely invested in the hardware, 

software, and connectivity necessary to eprescribe. CMS does not anticipate that the 

retirement of NCPDP SCRIPT 5.0 in favor of 

NCPDP SCRIPT 8.1 Medication History 

Standard for the exchange of medication 

history information, the adoption of the NCPDP 

Formulary and Benefits 1.0 for formulary and 

benefits transactions, the adoption of NPI for 

use in e-prescribing transactions, and the 

adoption of NCPDP SCRIPT 8.1 (RxFill) for 

electronic fill status notification purposes will 

result in significant costs. CMS anticipates that 

the ability to utilize electronic formulary and 

benefits inquiries will result in administrative 

efficiencies and increased prescribing of 

generic drugs versus brand name drugs, and 

the access to medication history at the point of 

care will result in reduced adverse drug 

events. The benefits accruing from using the 

adopted standards in these transactions will 

have an economically significant effect on 

Medicare Part D program cost and patient 

safety.

(The agency also concluded that the cost of 

implementing these standards is minimal, with 

quantifiable benefits reaped by dispensers, 

prescribers, and beneficiaries. Over 5 years, 

the agency expected these groups will see 

average net benefits in a range from $218 

million to $863.9 million from the utilization of 

formulary and benefits and medication history 

transactions, and the promulgation of these 

standards.)
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 71 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

55 Rule title: Medicare Program; 

Inpatient Psychiatric Facilities 

Prospective Payment System 

Payment Update for Rate Year 

Beginning July 1, 2008 (RY 2009)

Date: May 7, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-08

-777R

The notice updates the prospective 

payment rates for Medicare inpatient 

psychiatric facilities (IPF). The changes 

are applicable to IPF discharges 

occurring during the rate year beginning 

July 1, 2008, through June 30, 2009.

CMS performed a cost-benefit analysis of this 

final rule. CMS concludes that the effect of the 

updates described in this notice results in an 

overall $120 million increase in payments from 

rate year 2008 to rate year 2009. CMS does

not expect changes in the quality of care or 

access to services for Medicare beneficiaries 

due to the rate changes. CMS contends that 

access to IPF services will be enhanced due to 

patient and facility level adjustment factors, all 

of which are intended to adequately reimburse 

IPFs for expensive cases. Also, the outlier 

policy in the final rule is intended to assist IPFs 

that experience high-cost cases.

56 Rule title: State Children’s Health 

Insurance Program (SCHIP); 

Retrospective Adjustment for 

Additional Allotments To Eliminate 

Fiscal Year (FY) 2007 Funding 

Shortfalls; Final SCHIP Allotments for 

FYs 2008 and 2009; Redistribution of 

Unused SCHIP FY 2005 Allotments 

To Eliminate FY 2008 Funding 

Shortfalls; Additional Allotments To 

Eliminate FY 2008 Funding 

Shortfalls; and Provisions for 

Continued Authority for Qualifying 

States To Use a Portion of Certain 

SCHIP Funds for Medicaid 

Expenditures

Date: May 23, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-08

-952R

The notice describes the 

implementation of certain funding under 

SCHIP as amended. The funding 

provisions include retrospective 

adjustment of the additional allotments 

to eliminate fiscal year 2007 SCHIP 

funding shortfalls; the final fiscal years 

2008 and 2009 SCHIP allotments; the 

redistribution of the amounts of states’ 

unused fiscal year 2005 allotments to 

eliminate fiscal year 2008 SCHIP 

funding shortfalls; the provision of 

additional allotments to eliminate fiscal 

year 2008 SCHIP funding shortfalls; and 

the provision for ‘‘qualifying States’’ to 

elect to use a portion of their available 

SCHIP allotments as increased federal 

matching funds for certain expenditures 

in their Medicaid programs. 

CMS provides tables identifying SCHIP 

allotments for fiscal years 2008 and 2009. 

However, since the availability of such 

allotment funds were calculated based on 

methodologies specified in statute and does 

not put forward any discretionary 

administrative policies, CMS determined that 

there are no policy options that require an 

analysis beyond that which is presented in the 

tables.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 72 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

57 Rule title: Medicare Program; 

Changes to the Hospital Inpatient 

Prospective Payment Systems and 

Fiscal Year 2009 Rates; Payments 

for Graduate Medical Education in 

Certain Emergency Situations; 

Changes to Disclosure of Physician 

Ownership in Hospitals and 

Physician Self-Referral Rules; 

Updates to the Long-Term Care 

Prospective Payment System; 

Updates to Certain IPPS-Excluded 

Hospitals; and Collection of 

Information Regarding Financial 

Relationships Between Hospitals

Date: August 19, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rules

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-08

-1119R

The notice lists the final wage indices, 

hospital reclassifications, payment 

rates, impacts, and other related items 

for fiscal year 2009 pursuant to the 

Medicare Improvement for Patients and 

Providers Act of 2008.

CMS examined the costs and benefits of this 

notice. CMS projects that the increase in 

operating payments in fiscal year 2009, as 

compared to 2008, will be approximately $4.97 

billion and the increase in capital payments 

over the same period to be $60 million. CMS, 

therefore, expects a net increase of $5.03 

billion in the operating and capital payments to 

inpatient prospective payment system 

providers.

58 Rule title: Medicare Program; 

Revisions to the Medicare Advantage 

and Prescription Drug Benefit 

Programs 

Date: September 18, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-51R

The interim final rule changes the 

Medicare Advantage regulations to 

conform to statutory requirements 

regarding special needs plans, privatefee-for-service plans, regional preferred 

provider organizations plans, and 

Medicare medical savings accounts 

plans. It also implements statutory 

provisions governing cost-sharing for 

dual-eligible enrollees in the Medicare 

Advantage program prescription drug 

pricing, coverage, and payment 

processes in the Part D program. The 

interim final rule also sets forth new 

requirements governing the marketing 

of Part C and D plans.

CMS analyzed the costs and benefits of this 

interim final rule. CMS estimated the prompt 

payment provisions of the rule to cost the 

federal government a total of $670 million in 

calendar years 2010 to 2018. The other 

provisions will cost Medicare Advantage 

organizations and prescription drug sponsors 

$26.7 million in 2010. CMS estimates that the 

rule will have an incurred savings in total 

(before the Part B premium offset) of $8.1 

billion in calendar years 2011 to 2018. CMS 

estimates that the rule will result in a net 

savings in total of $7.43 billion to the federal 

government from 2010 to 2018.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 73 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

59 Rule title: Medicare Program; Part A 

Premium for Calendar Year 2009 for 

the Uninsured Aged and for Certain 

Disabled Individuals Who Have 

Exhausted Other Entitlement

Date: September 24, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/decisions/majrule

/d0969r.pdf

The notice announces Medicare’s Part 

A premium for uninsured enrollees in

calendar year 2009.

CMS estimates that the aggregate cost to 

enrollees paying the premiums will be about 

$142 million in calendar year 2009 over the 

amount paid in 2008.

60 Rule title: Medicare Program; 

Medicare Part B Monthly Actuarial 

Rates, Premium Rate, and Annual 

Deductible Beginning January 1, 

2009

Date: September 24, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-66R

The notice announces the monthly 

actuarial rates for aged and disabled 

beneficiaries enrolled in Medicare Part 

B beginning January 1, 2009. In 

addition, this notice announces the 

monthly premium for aged and disabled 

beneficiaries as well as the incomerelated monthly adjustment amounts to 

be paid by beneficiaries with modified 

adjusted gross income above certain 

threshold amounts.

CMS estimated that the increase will cost 

approximately 1.7 million Part B enrollees 

about $770 million.

61 Rule title: Medicare Program; 

Inpatient Hospital Deductible and 

Hospital and Extended Care Services 

Coinsurance Amounts for Calendar 

Year 2009

Date: September 24, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-09

-65R 

The notice announces the inpatient 

hospital deductible and the hospital and 

extended care services coinsurance 

amounts for services furnished in 

calendar year 2009 under Medicare 

Part A.

CMS estimated that the total increase in costs 

to beneficiaries will be about $680 million, due 

to the increase in the deductible and 

coinsurance amounts and the changes in the 

number of deductibles and daily coinsurance 

amounts paid.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 74 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

62 Rule title: Medicare Program; 

Hospital Inpatient Prospective 

Payment Systems and Fiscal Year 

2009 Rates: Final Fiscal Year 2009 

Wage Indices and Payment Rates 

Including Implementation of Section 

124 of the Medicare Improvement for 

Patients and Providers Act of 2008

Date: October 3, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule

Exception(s) to NPRM cited: Other 

reason

GAO major rule report:

http://www.gao.gov/products/GAO-09

-97R

The notice lists the final wage indices, 

hospital reclassifications, payment 

rates, impacts, and other related items 

for fiscal year 2009 pursuant to the 

Medicare Improvement for Patients and 

Providers Act of 2008.

CMS examined the costs and benefits of this 

notice. CMS projects that the increase in 

operating payments in fiscal year 2009, as 

compared to 2008, will be approximately $4.97 

billion and the increase in capital payments 

over the same period to be $60 million. CMS, 

therefore, expects a net increase of $5.03 

billion in the operating and capital payments to 

inpatient prospective payment system 

providers.

63 Rule title: Medicare Program: 

Changes to the Hospital Outpatient 

Prospective Payment System and CY 

2009 Payment Rates; Changes to the 

Ambulatory Surgical Center Payment 

System and CY 2009 Payment 

Rates; Hospital Conditions of 

Participation: Requirements for 

Approval and Re-Approval of 

Transplant Centers To Perform 

Organ Transplants— Clarification of 

Provider and Supplier Termination 

Policy Medicare and Medicaid 

Programs: Changes to the 

Ambulatory Surgical Center 

Conditions for Coverage

Date: November 18, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period; final rules

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-211R

This final rule revises the Medicare 

hospital outpatient prospective payment 

system to implement changes made by 

the Medicare Improvement for Patients 

and Providers Act of 2008 and changes 

arising from experience with the system. 

This final rule also revises the Medicare 

ambulatory surgical center (ASC) 

payment system. These changes are 

applicable to services furnished on or 

after January 1, 2009.

CMS performed a cost-benefit analysis of the 

final rule. CMS estimates that the total 

increase (from changes in this final rule as well 

as enrollment, utilization, and case-mix 

changes) in expenditures under the hospital 

outpatient prospective payment system 

(OPPS) for calendar year 2009 compared to 

calendar year 2008 will be approximately $1.6 

billion. CMS also estimates that the effects of 

the changes to the ASC payment system 

provisions for calendar year 2009 will have no 

net effect on Medicare expenditures in CY 

2009 compared to the level of expenditures in 

CY 2008.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 75 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

64 Rule title: Medicare Program; 

Payment Policies Under the 

Physician Fee Schedule and Other 

Revisions to Part B for CY 2009; EPrescribing Exemption for ComputerGenerated Facsimile Transmissions; 

and Payment for Certain Durable 

Medical Equipment, Prosthetics, 

Orthotics, and Supplies (DMEPOS)

Date: November 19, 2008

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report:

http://www.gao.gov/products/GAO-09

-218R 

The final rule revises the Medicare 

hospital inpatient prospective payment 

system for operating and capital-related 

costs. These changes arise from CMS’s 

continuing experience with these 

systems and implement provisions of 

three statutes. This rule also describes 

changes to the amounts and factors 

used to determine the rates for 

Medicare hospital inpatient services for 

operating costs and capital-related 

costs. Further, the rule sets limits on the 

rate of increase for certain hospitals and 

hospital units that are excluded from the 

inpatient prospective payment system.

CMS performed a cost-benefit analysis of the 

final rule. CMS estimates that the final rule will 

increase expenditures for calendar year 2009 

over the expenditures for calendar year 2008 

by $3 billion.

65 Rule title: Medicare Program; 

Medicare Advantage and Prescription 

Drug Benefit Programs: Negotiated 

Pricing and Remaining Revisions

Date: January 12, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-311R

The final rule revises the regulations 

governing the Medicare Advantage 

program (Part C) and prescription drug 

benefit program (Part D). The final rule 

includes provisions regarding medical 

savings account plans, cost-sharing for 

dual eligible enrollees enrolled in the 

Medicare Advantage program, the 

prescription drug payment and 

innovation processes in the Part D 

program, and the enrollment and 

appeals processes for both programs. 

Also, the interim final rule relates to 

certain aspects of the Retiree Drug 

Subsidy Program and reflects the new 

statutory definitions relating to Special 

Needs Plans under Part C.

CMS estimates that the costs associated with 

revisions to the beneficiary cost sharing and 

reinsurance subsidy payments will be $30 

million in fiscal year 2010, with a total cost of 

$530 million in fiscal years 2010-2018. CMS 

estimates that the costs related to other 

provisions in the final rule will be approximately 

$4.38 million in fiscal year 2010 and $3.82 

million per year in fiscal years 2011 through 

2018. CMS states that it has no reliable basis 

for estimating the economic benefits of the 

final rule, but expects that the clarifications 

included in the final rule could contribute to 

greater plan efficiency and compliance with 

program regulations.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 76 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

66 Rule title: Medicare Program: 

Medicare Advantage and Prescription 

Drug Programs MIPPA Drug 

Formulary & Protected Classes 

Policies

Date: January 16, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-329R

The interim final rule revises the 

regulations governing the Medicare 

prescription drug benefit program (Part 

D). These provisions change the 

definition of a covered Part D drug and 

add new requirements that apply to Part 

D formularies. This rule implements 

provisions Medicare Improvements for 

Patients and Providers Act of 2008

CMS analyzed the costs and benefits of this 

interim final rule. CMS estimates that the 

formulary requirements with respect to certain 

categories or classes of drugs will be $4.2 

billion from 2010 to 2018. With respect to 

economic benefits, CMS stated that it has no 

reliable basis for estimating the effects of the 

proposals contained in this interim final rule. 

Accordingly, CMS stated that, while there 

could be economic benefits associated with 

these proposals, such benefits are difficult to 

gauge at this time.

67 Rule title: Medicare Program; 

Inpatient Psychiatric Facilities 

Prospective Payment System 

Payment Update for Rate Year 

Beginning July 1, 2009 (RY 2010)

Date: May 1, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice; request for 

comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-698R

The notice updates the prospective 

payment rates for Medicare inpatient 

psychiatric facilities (IPF). The changes 

are applicable to IPF discharges 

occurring during the rate year beginning 

July 1, 2009, through June 30, 2010.

CMS estimates that the net effect of the 

updates described in this notice will result in an 

overall $87 million increase in payments from 

rate 2009 to rate year 2010. CMS does not 

expect changes in the quality of care or access 

to services for Medicare beneficiaries due to 

this notice. CMS contends that access to IPF 

services will be enhanced due to the patientand facility-level adjustment factors, all of 

which are intended to adequately reimburse 

IPFs for expensive cases. Also, the outlier 

policy is intended to assist IPFs that 

experience high-cost cases.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 77 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

68 Rule title: Medicare Program; 

Changes to the Hospital Inpatient 

Prospective Payment Systems for 

Acute Care Hospitals and Fiscal Year 

2010 Rates; and Changes to the 

Long-Term Care Hospital 

Prospective Payment System and 

Rate Years 2010 and 2009 Rates

Date: August 27, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rules and interim final 

rule with comment period

Exception(s) to NPRM cited: Good 

cause; statutory 

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-984R

The final rule revises the Medicare 

hospital inpatient prospective payment 

systems for operating and capitalrelated costs of acute care hospitals to 

implement changes arising from CMS’s 

continuing experience with those 

systems. It also implements certain 

statutory provisions relating to 

payments to long-term care hospitals 

(LTCH) and LTCH satellite facilities, the 

establishment of LTCHs and LTCH 

satellite facilities, and increases in beds 

in existing LTCHs and LTCH satellite 

facilities under the LTCH prospective 

payment system. 

CMS analyzed the costs and benefits of this 

final rule. CMS estimates that the market 

basket update to the inpatient prospective 

payment systems rates will result in an 

estimated $1.73 billion increase in fiscal year 

2010 operating payments (or 1.6 percent 

increase), and $171 million increase in fiscal 

year 2010 capital payments (or 1.9 percent 

increase). In addition, long-term care hospitals 

are expected to experience an increase in 

payments by $153 million (or 3.3 percent).

69 Rule title: Medicare Program; Part A 

Premium for Calendar Year 2010 for 

the Uninsured Aged and for Certain 

Disabled Individuals Who Have 

Exhausted Other Entitlement

Date: October 22, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-209R

The notice announces Medicare 

Hospital Insurance (Part A) premium for 

uninsured enrollees in calendar year 

(CY) 2010. This premium is paid by 

enrollees age 65 and over who are not 

otherwise eligible for benefits under 

Medicare Part A and by certain disabled 

individuals who have exhausted other 

entitlement. The monthly Part A 

premium for the 12 months beginning 

January 1, 2010, for these individuals 

will be $461. The reduced premium for 

certain other individuals who qualify for 

a reduction of 45 percent will be $254.

For calendar year 2010, CMS estimates that 

the aggregate cost to enrollees paying the 

premiums will be about $125 million more than 

the amount they paid in calendar year 2009. 

The premium for calendar year 2010 of $461 is 

an increase of approximately 4 percent over 

the calendar year 2009 premium of $443. CMS 

estimates that approximately 558,000 

enrollees will voluntarily enroll in Medicare Part 

A by paying the full premium and that an 

additional 40,000 enrollees will pay the 

reduced premium.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 78 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

70 Rule title: Medicare Program; 

Medicare Part B Monthly Actuarial 

Rates, Premium Rate, and Annual 

Deductible Beginning January 1, 

2010

Date: October 22, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-208R

The notice announces the monthly 

actuarial rates for aged (age 65 and 

over) and disabled (under age 65) 

beneficiaries enrolled in Part B of the 

Medicare Supplementary Medical 

Insurance (SMI) program beginning 

January 1, 2010. The notice announces 

the monthly premium for aged and 

disabled beneficiaries as well as the 

income-related monthly adjustment 

amounts to be paid by beneficiaries with 

modified adjusted gross income above 

certain threshold amounts. The monthly 

actuarial rates for 2010 are $221 for 

aged enrollees and $270.40 for disabled 

enrollees. The standard monthly Part B 

premium rate for 2010 is $110.50, which

is equal to 50 percent of the monthly 

actuarial rate for aged enrollees or 

roughly 25 percent of the expected 

average total cost of Part B coverage 

for aged enrollees. (The 2009 standard 

premium rate was $96.40.) The Part B 

deductible for 2010 is $155 for all Part B 

beneficiaries. A beneficiary who has to 

pay an income-related monthly 

adjustment may have to pay a total 

monthly premium of roughly 35, 50, 65, 

or 80 percent of the total cost of Part B 

coverage.

CMS estimated that the standard Part B 

premium rate of $110.50, which is $14.10 

higher than the premium for 2009, will result in 

about $2 billion of additional costs in 2010 for 

the approximately 12 million Part B enrollees 

who pay the increase in the Part B premium.

71 Rule title: Medicare Program; 

Inpatient Hospital Deductible and 

Hospital and Extended Care Services 

Coinsurance Amounts for Calendar 

Year 2010

Date: October 22, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-10

-207R

The notice announces the inpatient 

hospital deductible and the hospital and 

extended care services coinsurance 

amounts for services furnished in 

calendar year 2010 under Medicare’s 

Hospital Insurance Program (Medicare 

Part A). For calendar year 2010, the 

inpatient hospital deductible will be 

$1,100. The daily coinsurance amounts 

for calendar year 2010 will be: (a) $275 

for the 61st through 90th day of 

hospitalization in a benefit period; (b) 

$550 for lifetime reserve days; and (c) 

$137.50 for the 21st through 100th day 

of extended care services in a skilled 

nursing facility in a benefit period.

CMS determined that the total increase in 

costs to beneficiaries will be about $730 

million, due to the increase in the deductible 

and coinsurance amounts and the change in 

the number of deductibles and daily 

coinsurance amounts paid.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 79 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

72 Rule title: Medicare Program; 

Payment Policies Under the 

Physician Fee Schedule and Other 

Revisions to Part B for CY 2010

Date: November 25, 2009

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period

Exception(s) to NPRM cited: Good 

cause; other reason

GAO major rule report:

http://www.gao.gov/products/GAO-10

-305R

The final rule implements changes to 

the physician fee schedule and other 

Medicare Part B payment policies to 

ensure that payment systems are 

updated to reflect changes in medical 

practice and the relative value of 

services. It also finalizes the calendar 

year 2009 interim relative value units 

(RVU) and issues interim RVUs for 

calendar year 2010. As required by 

statute, the final rule announces that the 

physician fee schedule update is 

negative 21.2 percent for calendar year 

2010, the preliminary estimate for the 

sustainable growth rate for calendar 

year 2010 is negative 8.8 percent, and 

the conversion factor (CF) for calendar 

year 2010 is $28.4061. 

CMS performed a cost-benefit analysis of the 

final rule. CMS estimates that the final rule will 

decrease expenditures for calendar year 2010 

over the expenditures for calendar year 2009 

by more than $20 million. Therefore, CMS is 

increasing the physician fee schedule 

conversion factor by 1.00103 to offset this 

estimated decrease in Medicare physician 

expenditures due to the calendar year 2010 

RVU changes.

73 Rule title: Regulations Restricting 

the Sale and Distribution of 

Cigarettes and Smokeless Tobacco 

To Protect Children and Adolescents

Date: March 19, 2010

Sub-agency: Food and Drug 

Administration (FDA)

Action: Final rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-580R 

The FDA is reissuing a final rule 

restricting the sale, distribution, and use 

of cigarettes and smokeless tobacco. 

As required by the Family Smoking 

Prevention and Tobacco Control Act 

(Tobacco Control Act), FDA is issuing a 

final rule that is identical to the 

provisions of the final rule on cigarettes 

and smokeless tobacco published by 

FDA in 1996, with certain required 

exceptions.

The rule did not include estimates of the 

costs, benefits, or transfer amounts..

(Because the Tobacco Control Act directed the 

Secretary of HHS to issue a final rule identical 

in its provisions to the final rule issued on 

August 28, 1996, OMB did not require a 

Regulatory Impact Analysis beyond that done 

at that time.)

74 Rule title: Medicare Program; 

Inpatient Psychiatric Facilities 

Prospective Payment System 

Payment—Update for Rate Year 

Beginning July 1, 2010 (RY 2011)

Date: April 30, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-713R

The notice updates the prospective 

payment rates for Medicare inpatient 

psychiatric facilities (IPF). The changes 

are applicable to IPF discharges 

occurring during the rate year beginning 

July 1, 2010, through June 30, 2011.

The net effect of the updates described in this 

notice results in an overall estimated $95 

million increase in payments from rate year 

2010 to rate year 2011. CMS does not expect 

changes in the quality of care or access to 

services for Medicare beneficiaries due to this 

notice. CMS contends that access to IPF 

services will be enhanced due to the patientand facility-level adjustment factors, all of 

which are intended to adequately reimburse 

IPFs for expensive cases. Also, the outlier 

policy is intended to assist IPFs that 

experience high-cost cases.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 80 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

75 Rule title: Early Retiree Reinsurance 

Program 

Date: May 5, 2010

Sub-agency: Office of the Secretary

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-732R

The interim final rule implements the 

Early Retiree Reinsurance Program, 

which was established by the Patient 

Protection and Affordable Care Act. The 

program provides reimbursement to 

participating employment-based plans 

for a portion of the cost of health 

benefits for early retirees and their 

spouses, surviving spouses and 

dependents. HHS will reimburse plans 

for certain claims between $15,000 and 

$90,000 (with those amounts being 

indexed for plan years starting on or 

after October 1, 2011). 

HHS analyzed the costs and benefits of this 

interim final rule. HHS believes that the costs 

imposed on sponsors that want to receive the 

early retiree reimbursement will not be 

significant relative to the payments received. 

The costs will consist of staff or contractor time 

to complete the applications to participate, file 

claims for reimbursement, and to comply with 

program requirements such as requests 

related to an audit.

[Over the 4 year period for which funds are 

appropriated for this program, the agency 

anticipated an overall positive transfer of $5 

billion to eligible sponsors (and indirectly a 

portion of those funds will be transferred for 

the benefit of plan participants), less 

administrative costs.]

76 Rule title: Medicare Program; 

Hospital Inpatient Prospective 

Payment Systems for Acute Care 

Hospitals and Fiscal Year 2010 

Rates and to the Long-Term Care 

Hospital Prospective Payment 

System and Rate Year 2010 Rates: 

Final Fiscal Year 2010 Wage Indices 

and Payment Rates Implementing 

the Affordable Care Act

Date: June 2, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause; interpretive rule; general 

statement of policy; and agency 

organization, procedure, or practice

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-830R

The notice contains the final wage 

indices, hospital reclassifications, 

payment rates, impacts, and other 

related tables effective for the fiscal 

year 2010 hospital inpatient prospective 

payment system (IPPS) and the rate 

year 2010 long-term care hospital 

(LTCH) prospective payment system. 

CMS notes that the rates, tables, and 

impacts included in this notice reflect 

changes required by or resulting from 

the implementation of several provisions 

of the Affordable Care Act.

CMS conducted a cost-benefit analysis of this 

notice. CMS estimates that the operating 

payments to the IPPS will increase by 

approximately $75.7 million in fiscal year 2010; 

the capital payments will increase by 

approximately $94.7 million in fiscal year 2010. 

CMS estimates that payments to the LTCHs 

will decrease by approximately $11 million in 

fiscal year 2010. Both of these estimates 

reflect changes from the previously published 

estimates for fiscal year 2010.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 81 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

77 Rule title: Medicare Program; 

Prospective Payment System and 

Consolidated Billing for Skilled 

Nursing Facilities for Fiscal Year 

2011

Date: July 22, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice with comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-973R

The notice updates the payment rates 

used under the prospective payment 

system for skilled nursing facilities for 

fiscal year 2011. In addition, this notice 

also implements a provision of the 

Patient Protection and Affordable Care 

Act which postpones the 

implementation of the Resource 

Utilization Groups, Version 4 (RUG-IV) 

case-mix classification system, but, 

notwithstanding the postponement, 

requires the implementation of the parts 

of RUG-IV related to concurrent therapy 

and the look-back period. 

CMS analyzed the costs and benefits of this 

notice. CMS estimates that overall payments 

for skilled nursing facilities will increase by 

$542 million, or 1.7 percent, in fiscal year 2011 

as compared to fiscal year 2010.

78 Rule title: Medicare Program; 

Inpatient Rehabilitation Facility 

Prospective Payment System for 

Federal Fiscal Year 2011

Date: July 22, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-970R

This notice updates the payment rates 

for inpatient rehabilitation facilities (IRF) 

for fiscal year 2011 (for discharges 

occurring on or after October 1, 2010, 

and on or before September 30, 2011) 

as required by statute. A statute 

requires the Secretary to publish in the 

Federal Register on or before the 

August 1 that precedes the start of each 

fiscal year, the classification and 

weighting factors for the IRF 

prospective payment system’s case-mix 

groups, and a description of the 

methodology and date used in

computing the prospective payment 

rates for that fiscal year. 

CMS prepared a cost-benefit analysis for this 

notice and estimates that the total impact of 

these charges for fiscal year 2011 will be a net 

increase of $135 million in payments to IRF 

providers. Overall, the estimated payments per 

discharge for IRFs in fiscal year 2011 are 

projected to increase by 2.16 percent, 

compared with revised estimated payments in 

fiscal year 2010. IRF payments per discharge 

are estimated to increase 2.17 percent in 

urban areas, and 2.05 percent in rural areas, 

compared with the revised estimated fiscal 

year 2010 payments.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 82 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

79 Rule title: Pre-Existing Condition 

Insurance Plan Program

Date: July 30, 2010

Sub-agency: Office of Consumer 

Information and Insurance Oversight

(OCIIO)

Action: Interim final rule with 

comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-998R

The interim final rule implements a 

provision of the Patient Protection and 

Affordable Care Act which requires HHS 

to establish, either directly or through 

contracts with states or nonprofit 

entities, a temporary high risk health 

insurance pool program to provide 

affordable health insurance coverage to 

uninsured individuals with pre-existing 

conditions. This program will continue 

until January 1, 2014. This rule 

addresses issues such as 

administration of the program, eligibility 

and enrollment, benefits, premiums, 

funding, and appeals and oversight 

rules.

HHS analyzed the costs and benefits of this 

interim final rule. In assessing the benefits of 

this rule, HHS stated that the Pre-existing 

Condition Insurance Plan (PCIP) will provide 

uninsured Americans with pre-existing 

conditions and that have been denied 

coverage or otherwise excluded from 

purchasing insurance coverage an opportunity 

to obtain coverage. HHS determined that 

providing this insurance option will increase 

access to health care and reduce financial 

strain for participants and will likely improve 

health outcomes and worker productivity. HHS 

found that individuals who are especially 

vulnerable as a result of existing health 

problems and financial status may receive the 

greatest benefit from this program. HHS 

estimated that the annual reporting and 

recordkeeping costs associated with this 

interim final rule will be $1.94 million. HHS 

determined that, to the extent PCIP increases 

access to health care services, increased 

health care utilization and costs will result due 

to increased uptake. HHS also identified 

administrative costs of the rule, including the 

cost of contractors to apply, the time cost for 

individuals to apply, and the contractors’ costs 

of complying with program rules (e.g., 

conducting appeals, preventing fraud). Finally 

HHS estimates that under this rule $5 billion in 

federal funds will be transferred to contractors 

to aid in administering the program.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 83 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

80 Rule title: Medicare Program; 

Hospital Inpatient Prospective 

Payment Systems for Acute Care 

Hospitals and the Long-Term Care 

Hospital Prospective Payment 

System Changes and FY2011 Rates; 

Provider Agreements and Supplier 

Approvals; and Hospital Conditions of 

Participation for Rehabilitation and 

Respiratory Care Services; Medicaid 

Program: Accreditation for Providers 

of Inpatient Psychiatric Services

Date: August 16, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rules and interim final 

rule with comment period

Exception(s) to NPRM cited: Good 

cause; statutory (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-1027R

The final rule revises the Medicare 

hospital inpatient prospective payment 

systems (IPPS) for operating and 

capital-related costs of acute care 

hospitals to implement changes arising 

from CMS’s continuing experience with 

these systems and to implement certain 

statutory provisions. In addition, the rule 

describes the changes to the amounts 

and factors used to determine the rates 

for Medicare acute care hospital 

inpatient services for operating costs 

and capital-related costs. The rule 

updates the rate-of-increase limits for 

certain hospitals excluded from the 

IPPS that are paid on a reasonable cost 

basis subject to these limits. Further, 

this rule updates the payment policy 

and the annual payment rates for the 

Medicare prospective payment system 

(PPS) for inpatient hospital services 

provided by long-term care hospitals 

(LTCH) and sets forth the changes to 

the payment rates, factors, and other 

payment rate policies under the LTCH 

PPS. In addition, the rule finalizes the 

implementation of statutory provisions 

relating to payments to LTCHs and 

LTCH satellite facilities and increases in 

beds in existing LTCHs and LTCH 

satellite facilities under the LTCH PPS.

CMS analyzed the costs and benefits of this 

final rule. CMS estimated that the final 

applicable percentage increase to the inpatient 

prospective payment systems (IPPS) rates 

required by the statute, in conjunction with 

other final payment changes in this final rule, 

will result in a $440 million decrease in fiscal 

year 2011 operating payments (or negative 0.4 

percent decrease) and an estimated $21 

million decrease in fiscal year 2011 capital 

payments (or negative 0.5 percent change). In 

addition, long-term care hospitals (LTCHs) are 

expected to experience an increase in 

payments by $22.3 million (or 0.5 percent).

81 Rule title: Medicare Program; 

Hospice Wage Index for Fiscal Year 

2011

Date: October 1, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice with comment period

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-10

-974R

The notice announces the annual 

update to the hospice wage index for 

fiscal year 2011 and continues the 

phase out of the wage index budget 

neutrality adjustment factor (BNAF), 

with an additional 15 percent BNAF 

reduction, for a total BNAF reduction in 

fiscal year 2011 of 25 percent. The 

BNAF phase-out will continue with 

successive 15 percent reductions from 

fiscal years 2012 through 2016.

CMS estimates that the total hospice 

payments will increase by $220 million in fiscal 

year 2010 when both the 2.6 percent hospital 

market basket update and the 25 percent 

reduction in the BNAF and updated wage data 

are taken into account.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 84 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

82 Rule title: Medicare Program; 

Medicare Part B Monthly Actuarial 

Rates, Premium Rate, and Annual 

Deductible Beginning January 1, 

2011

Date: November 9, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause; agency organization, 

procedure, or practice

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-214R

The notice announces the monthly 

actuarial rates for aged and disabled 

beneficiaries enrolled in Part B of the 

Medicare Supplementary Medical 

Insurance program beginning January 

1, 2011. In addition, this notice 

announces the monthly premium for 

aged and disabled beneficiaries as well 

as the income-related monthly 

adjustment amounts to be paid by 

beneficiaries with modified adjusted 

gross income above certain threshold 

amounts. The monthly actuarial rates 

for 2011 are $230.70 for aged enrollees 

and $266.30 for disabled enrollees. The 

standard monthly Part B premium rate 

for 2011 is $115.40, which is equal to 

50 percent of the monthly actuarial rate 

for aged enrollees or approximately 25 

percent of the expected average total 

cost of Part B coverage for aged 

enrollees. (The 2010 standard premium 

rate was $110.50.) The Part B 

deductible for 2011 is $162.00 for all 

Part B beneficiaries. If a beneficiary has 

to pay an income-related monthly 

adjustment, they may have to pay a 

total monthly premium of about 35, 50, 

65, or 80 percent of the total cost of Part 

B coverage.

CMS estimates the standard Part B premium 

rate of $115.40 is $4.90 higher than the 

premium for 2010, so there will be about $700 

million of additional costs in 2011 to the 

approximately 12 million Part B enrollees who 

pay the increase in the Part B premium.

83 Rule title: Medicare Program; 

Inpatient Hospital Deductible and 

Hospital and Extended Care Services 

Coinsurance Amounts for CY 2011

Date: November 9, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Notice

Exception(s) to NPRM cited: Good 

cause; agency organization, 

procedure, or practice

GAO major rule report:

http://www.gao.gov/products/GAO-11

-215R

The notice announces the inpatient 

hospital deductible and the hospital and 

extended care services coinsurance 

amounts for services furnished in 

calendar year 2011 under Medicare’s 

Hospital Insurance Program (Medicare 

Part A).

CMS estimates that the total increase in costs 

to beneficiaries is about $900 million due to the 

increase in the deductible and coinsurance 

amounts and the change in the number of 

deductibles and daily coinsurance amounts 

paid.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 85 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

84 Rule title: Medicare Program: 

Hospital Outpatient Prospective 

Payment System and CY 2011 

Payment Rates; Ambulatory Surgical 

Center Payment System and CY 

2011 Payment Rates; Payments to 

Hospitals for Graduate Medical 

Education Costs; Physician SelfReferral Rules and Related Changes 

to Provider Agreement Regulations; 

Payment for Certified Registered 

Nurse Anesthetist Services 

Furnished in Rural Hospitals and 

Critical Access Hospitals

Date: November 24, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period; final rules; and interim final 

rule with comment period.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-246R

The final rule revises the Medicare 

hospital outpatient prospective payment 

system (OPPS) to implement applicable 

statutory requirements and changes 

arising from CMS’s experience with this 

system and to implement certain 

provisions of the Affordable Care Act. 

The final rule describes the changes to 

the amounts and factors used to 

determine the payment rates for 

Medicare hospital outpatient services 

paid under the prospective payment 

system for services furnished on or after 

January 1, 2011. In addition, this final 

rule updates the revised Medicare 

Ambulatory Surgical Center (ASC) 

payment system to implement 

applicable statutory requirements and 

changes arising from CMS’s experience 

with this system and to implement 

certain provisions of the Affordable Care 

Act. 

CMS performed a cost-benefit analysis of the 

final rule with comment period. CMS estimates 

that the total increase (from changes in the 

final rule with comment period as well as 

enrollment, utilization, and case-mix changes) 

in expenditures under the hospital OPPS for 

calendar year 2011 compared to calendar year 

2010 will be approximately $3.2 billion. CMS 

also estimates that the total increase (from 

changes in the final rule with comment period 

as well as enrollment, utilization, and case-mix 

changes) in expenditures under the ASC 

payment system provisions for calendar year 

2011 compared to calendar year 2010 will be 

approximately $230 million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 86 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

85 Rule title: Medicare Program; 

Payment Policies Under the 

Physician Fee Schedule and Other 

Revisions to Part B For CY 2011

Date: November 29, 2010

Sub-agency: Centers for Medicare & 

Medicaid Services

Action: Final rule with comment 

period

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-251R

This final rule addresses changes to the 

physician fee schedule and other 

Medicare Part B payment policies to 

ensure that payment systems are 

updated to reflect changes in medical 

practice and the relative value of 

services. It finalizes the calendar year 

2010 interim relative value units (RVU) 

and issues interim RVUs for new and 

revised procedure codes for calendar 

year 2011. It also addresses, 

implements, or discusses certain 

provisions of both the Affordable Care 

Act (ACA) and the Medicare 

Improvements for Patients and 

Providers Act of 2008 (MIPPA). In 

addition, this final rule discusses 

payments under the Ambulance Fee 

Schedule (AFS), the Ambulatory 

Surgical Center (ASC) payment system, 

and the Clinical Laboratory Fee 

Schedule (CLFS); payments to endstage renal disease (ESRD) facilities; 

and payments for Part B drugs. Finally, 

this final rule also includes a discussion 

regarding the Chiropractic Services 

Demonstration program, the 

Competitive Bidding Program for 

durable medical equipment, prosthetics, 

orthotics, and supplies (CBP DMEPOS), 

and provider and supplier enrollment 

issues associated with air ambulances.

CMS prepared a cost-benefit analysis of the 

final rule. CMS estimates that the final rule will 

result in a decrease in expenditures of $17.6 

billion for physician fee schedule (PFS) 

conversion factor update. CMS estimates an 

increase in expenditures of $1.97 billion for 

Affordable Care Act provisions.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 87 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

86 Rule title: Health Insurance Issuers 

Implementing Medical Loss Ratio 

(MLR) Requirements Under the 

Patient Protection and Affordable 

Care Act

Date: December 1, 2010

Sub-agency: Office of Consumer 

Information and Insurance Oversight

Action: Interim final rule with request 

for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report:

http://www.gao.gov/products/GAO-11

-259R

The interim final rule implements the 

medical loss ratio (MLR) requirements 

for health insurance issuers under the 

Public Health Service Act, as added by 

the Patient Protection and Affordable 

Care Act. 

In developing this interim final regulation, HHS 

carefully considered its potential effects 

including both costs and benefits. Because of 

data limitations, HHS did not attempt to 

quantify the benefits of this regulation. 

Nonetheless, HHS was able to identify several 

potential benefits. HHS believes one potential 

benefit to this regulation is greater market 

transparency and improved ability of 

consumers to make informed insurance 

choices. In addition, HHS states that issuers 

that would not otherwise meet the MLR 

minimum defined by this regulation may 

increase spending on quality-promoting 

activities. According to HHS, these programs, 

which include case management, care 

coordination, chronic disease management, 

and medication compliance, have the potential 

to create a societal benefit by improving 

outcomes and population health. HHS notes 

that issuers that would not otherwise meet the 

MLR minimum may also expand covered 

benefits or reduce cost sharing. HHS believes 

that to the extent that these changes result in 

increased consumption of effective health 

services, the regulation could result in 

improved health outcomes, thereby creating a 

societal benefit.

HHS has identified the primary sources of 

costs associated with this regulation as the 

costs associated with reporting, recordkeeping, 

rebate notifications and payments, and other 

costs. HHS estimates that issuers will incur 

approximately $33 million to $67 million in onetime administrative costs, and $11 million to 

$29 million in annual ongoing administrative 

costs related to complying with the 

requirements of this interim final regulation 

from 2011 through 2013. HHS notes that there 

are two other potential types of costs 

associated with this regulation: costs of 

potential increases in medical care use, the 

cost of additional quality-improving activities, 

and costs to consumers if some issuers decide 

to limit offered products as a result of this 

interim final regulation.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 88 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Homeland Security 

(DHS)

87 Rule title: Allocation of Additional H–

1B Visas Created by the H–1B Visa 

Reform Act of 2004

Date: May 5, 2005

Sub-agency: U.S. Citizenship and 

Immigration Services (USCIS)

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-05

-705R

The interim rule implements statutory 

changes to the numerical limits of the H1B nonimmigrant visa category and the 

fees for filing H-1B petitions. The rule 

also contains procedures to allocate the 

additional 20,000 H-1B numbers. 

Finally, the rule announces the 

additional fees that must be filed with 

certain H-1B petitions.

USCIS estimates that the interim rule will 

provide it with an additional $36,200,000 in 

fiscal year 2005 in annual fee revenue over the 

fee revenue that would be collected under the 

current fee structure, based on a projected 

annual fee-paying volume of 20,000 approved 

petitions. In fiscal year 2006, there would be 

an additional $138,425,000 in fee revenue 

based on projected annual fee-paying volume 

of 85,000 approved petitions (20,000 new 

exemptions and 65,000 petitions).

88 Rule title: Chemical Facility AntiTerrorism Standards

Date: April 9, 2007

Sub-agency: N/A

Action: Interim final rule

Exception(s) to NPRM cited:

Statutory

GAO major rule report:

http://www.gao.gov/products/GAO-07

-747R 

This interim final rule establishes riskbased performance standards for the 

security of chemical facilities. It requires 

chemical facilities that pose a high-risk 

to prepare Security Vulnerability 

Assessments and to develop and 

implement Site Security Plans.

DHS conducted a Regulatory Assessment that 

estimated the costs of this interim final rule. 

DHS estimates the costs to be $3.6 billion over 

the period 2006-2009 and $8.5 billion over the 

period 2006-2015. DHS estimates that 

between 1,500 and 6,500 chemical facilities 

will be impacted by this interim final rule and 

uses the estimate of 5,000 impacted facilities 

to generate the cost estimates. According to 

DHS, this interim final rule gives chemical 

facilities considerable flexibility, which will 

lower compliance costs. The benefit of this 

interim final rule is decreased vulnerability of 

high-risk chemical facilities to terrorist attack.

89 Rule title: Changes to the Visa 

Waiver Program To Implement the 

Electronic System for Travel 

Authorization (ESTA) Program

Date: June 9, 2008

Sub-agency: Bureau of Customs 

and Border Protection (CBP)

Action: Interim final rule; solicitation 

of comments

Exception(s) to NPRM cited: Good 

cause; military or foreign affairs 

function; and agency organization, 

procedure, or practice

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-906R 

The interim final implements the 

statutory requirements for the Electronic 

System for Travel Authorization (ESTA) 

for aliens who wish to enter the United 

States under the Visa Waiver Program 

(VWP) at air or sea ports of entry.

DHS conducted a cost-benefit analysis of this 

interim final rule. DHS estimates that the 

annualized costs will be $16 million to $118 

million. These costs are for U.S. and foreignbased air and sea carriers. Quantified benefits 

of $17 million to $29 million to carriers and 

CBP are for annual travel authorizations 

denied by ESTA that prevent inadmissible 

persons from applying for admission under the 

VWP at a United States port of entry. Nonquantified benefits are enhanced security and 

efficiency.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 89 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

90 Rule title: Air Cargo Screening

Date: September 16, 2009

Sub-agency: Transportation Security 

Administration (TSA)

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report:

http://www.gao.gov/products/GAO-09

-1043R

The interim final rule implements a 

statutory requirement to establish a 

system to screen 100 percent of cargo 

transported on passenger aircraft by 

August 3, 2010.

TSA conducted a cost-benefit analysis of this 

interim final rule. Over the 10-year period of 

the analysis, TSA estimates that the aggregate 

costs of this rulemaking to total approximately 

$2.8 billion, undiscounted. Discounted at 7 

percent, the cost is $1.9 billion, and discounted 

at 3 percent, the cost is $2.4 billion. The cost 

of this rule would be borne by five relevant 

parties: certified cargo screening facilities 

(CCSF), non-CCSF entities that receive 

screened cargo from CCSFs, validation firms, 

aircraft operators, and TSA. Additionally, 

industry will bear a cost for delayed shipment 

of cargo estimated at $297.1 million over the 

10-year analysis period ($203.1 million 

discounted at 7 percent and $250.4 million 

discounted at 3 percent). TSA anticipates 

bearing costs to administer the provisions of 

the rulemaking at $384 million over the 10-year 

analysis period.

(Regarding benefits, the agency also said that 

the interim final rule will allow for more 

standard governance in cargo screening and 

will provide benefits in terms of increased 

security of commercial passenger aviation.)

91 Rule title: Electronic System for 

Travel Authorization (ESTA): Travel 

Promotion Fee and Fee for Use of 

the System

Date: August 9, 2010

Sub-agency: U.S. Customs and 

Border Protection

Action: Interim final rule; solicitation 

of comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-1010R

The interim final rule requires ESTA 

applicants to pay a congressionally 

mandated fee of $14. The fee is the 

sum of two amounts: a $10 travel 

promotion fee set by statute and a $4 

operational fee to ensure recovery of 

the full costs of providing and 

administering the ESTA system. 

DHS conducted a cost-benefit analysis of this 

interim final rule. DHS concluded that the 

annualized cost to applicants, primarily in the 

form of transfers from foreign citizens to the 

U.S. government, is estimated between $152 

million and $258 million. With respect to 

benefits, DHS states that this interim final rule 

allows DHS to comply with the Travel 

Promotion Act of 2009 and enhances security.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 90 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

92 Rule title: U.S. Citizenship and 

Immigration Services Fee Schedule

Date: September 24, 2010

Sub-agency: U.S. Citizenship and 

Immigration Services

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-104R 

The final rule adjusts the USCIS fee 

schedule to fully recover costs and 

maintain adequate service. The final 

rule increases the fees by a weighted 

average of 10 percent; establishes three 

new fees and adjusts the premium 

processing service by the percentage 

increase in inflation according to the 

Consumer Price Index-Urban 

Consumers, published as of July 2010. 

The final rule also finalizes the interim 

rule that established the premium 

processing service and fees.

The final rule will provide DHS with an average 

of $209 million in fiscal years 2010 and 2011 

annual fee revenue, based on a projected 

annual fee-paying volume of 4.4 million 

immigration benefit requests and 1.9 million 

requests for biometric services, over the fee 

revenue that would be collected under the 

current fee structure. The increased revenue 

will be used to fund the full cost of processing 

immigration benefit applications and 

associated support benefits; the full cost of 

providing similar benefits to asylum and 

refugee applicants; and the full cost of similar 

benefits provided to others at no charge.

Department of Housing and Urban 

Development (HUD)

93 Rule title: HOPE for Homeowners 

Program: Program Regulations

Date: October 6, 2008

Sub agency: Board of Directors of 

the HOPE for Homeowners Program

Action: Final rule

Exception(s) to NPRM cited: Matter 

relating to public property, loans, 

grants, benefits or contracts

GAO major rule report:

http://www.gao.gov/products/GAO-09

-101R 

The final rule sets forth the core 

requirements for the HOPE for 

Homeowners Program, a temporary 

program to insure refinanced loans for 

homeowners who are at risk of losing 

their homes to foreclosure.

The Board of Directors for the HOPE for 

Homeowners Program prepared an economic 

analysis in conjunction with this final rule. The 

Board of Directors anticipates that the net 

economic benefits will exceed the costs. The 

Program has the potential to have significant 

economic benefits, but it is difficult to quantify 

the benefits because the rate of participation is 

unknown. The Board of Directors estimates 

that the net benefit to the lender will be 

$10,000, but it may be higher; communities will 

also experience an economic benefit by 

preventing foreclosures.

94 Rule title: HOPE for Homeowners 

Program; Statutory Transfer of 

Program Authority to HUD and 

Conforming Amendments To Adopt 

Recently Enacted Statutory Changes

Date: January 12, 2010

Sub-agency: Office of the Assistant 

Secretary for Housing-Federal 

Housing Commissioner

Action: Interim rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-372R

The interim rule implements statutory 

changes made to the HOPE for 

Homeowners program. These changes 

include transferring responsibility for the 

program to HUD, establishing an 

exemption for a mortgagor who has 

inherited property, and revising required 

mortgagor representations. This rule 

also requires borrowers’ debt-to-income 

ratio to be calculated based on 

mortgages existing at the time of 

application to the program. In addition, 

the rule makes changes to the loan-tovalue thresholds, the allowable total 

monthly payments, the appreciation 

sharing and upfront payment provisions, 

the upfront and annual mortgage 

insurance premium requirements, and 

the property preservation exception to 

subordinate lien restrictions.

According to HUD, it did not prepare an 

analysis of the costs and benefits of this 

interim rule. HUD did prepare an Economic 

Analysis for this rule. HUD found that the 

economic impacts from the changes in this 

interim rule stem largely from increased 

participation in the H4H program. HUD 

estimates that, with 10,000 participants 

annually, the H4H program will generate $273 

million in net benefits to society and that H4H 

participation could be as high as 137,500 

households over the life of the program, with 

commensurately higher benefits.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 91 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of the Interior

95 Rule title: Oil and Gas and Sulphur 

Operations in the Outer Continental 

Shelf—Increased Safety Measures 

for Energy Development on the Outer 

Continental Shelf

Date: October 14, 2010

Sub-agency: Bureau of Ocean 

Energy Management, Regulation and 

Enforcement (BOEMRE)

Action: Interim final rule with request 

for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-11

-155R

The interim final rule implements certain 

safety measures recommended in the 

report entitled, “Increased Safety 

Measures for Energy Development on 

the Outer Continental Shelf” dated May 

27, 2010. BOEMRE is amending drilling 

regulations related to well control, 

including sub-sea and surface blowout 

preventers, well casing and cementing, 

secondary intervention, unplanned 

disconnects, recordkeeping, well 

completion, and well plugging. 

BOEMRE states that the cost-benefit analysis 

for this rule was conducted using a scenario 

analysis. BOEMRE explains that the costbenefit analysis considers a regulation 

designed to reduce the likelihood of a 

catastrophic oil spill, while the costs are the 

compliance costs of imposed regulation. 

BOEMRE notes that if another catastrophic oil 

spill is prevented, the benefits are the avoided 

costs associated with a catastrophic oil spill 

(e.g., reduction in expected natural resource 

damages owing to the reduction in likelihood of 

failure).

Noting that the estimated costs of this 

rulemaking, as reflected in the compliance 

costs of the enumerated requirements of 

approximately $180 million per year, have a 

strong foundation and are based on surveys of 

public and industry sources, BOEMRE states 

that quantification of the benefits is uncertain. 

BOEMRE believes the benefits are 

represented by the avoided costs of a 

catastrophic spill, which are estimated under 

the stipulated scenario as being $16.3 billion 

per spill avoided. According to BOEMRE, 

these regulations will reduce the likelihood of 

another blowout and associated spill, but the 

risk reduction associated with the specific 

provisions of this rulemaking cannot be 

quantified because there are many complex 

factors that affect the risk of a blowout event.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 92 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of Labor (DOL)

96 Rule title: Performance of Functions; 

Claims for Compensation Under the 

Energy Employees Occupational 

Illness Compensation Program Act of 

2000, as Amended

Date: December 29, 2006

Sub-agency: Office of Workers’ 

Compensation Programs, 

Employment Standards 

Administration

Action: Final rule

Exception(s) to NPRM cited: Good 

cause; Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-330R

The rule finalizes an interim final rule 

published on June 8, 2005. The rule 

provided for compensation payable by 

statute.

DOL performed a cost-benefit analysis of the 

final rule that resulted in the following 

estimates of the aggregate cost of benefits and 

administrative costs (in millions of dollars):

Fiscal Year Administrative Cost Benefits

2007 $162 $1,123

2008 $163 $ 861

2009 $147 $ 752

2010 $127 $ 656

2011 $111 $ 579

97 Rule title: Annual Reporting and 

Disclosure

Date: November 16, 2007

Sub-agency: Employee Benefits 

Security Administration

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; other reason (P) 

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-310R

The final rule amends the annual 

reporting and disclosure requirements 

under the Employee Retirement Income 

Security Act of 1974, as amended 

(ERISA). The amendments are 

necessary to conform the annual 

reporting and disclosure regulations to 

revisions to the Form 5500, filed for 

employee pensions and welfare benefit 

plans under ERISA and the Internal 

Revenue Code. The Form 5500 

changes are intended to facilitate the 

transition to an electronic filing system; 

reduce and streamline annual reporting 

burdens, especially for small 

businesses; and update the annual 

reporting forms to reflect current issues, 

agency priorities, and new requirements 

under the Pension Protection Act of 

2006.

DOL concluded that the use of the 5500 Forms 

will relieve plans subject to the annual 

reporting requirements from increased costs 

and unreasonable administrative burdens by 

providing a standardized format that facilitates 

reporting, eliminates duplicative reporting 

requirements, and simplifies the content of the 

annual report in general. The 5500 Forms are 

intended to reduce further the administrative 

burdens and costs attributable to compliance 

with the annual reporting requirements. Over 

the next 10 years, DOL anticipates an average 

annual reduction in costs of more than $97 

million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 93 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of State (State)

98 Rule title: Schedule of Fees for 

Consular Services, Department of 

State and Overseas Embassies and 

Consulates

Date: January 29, 2008

Sub-agency: N/A

Action: Interim final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-575R

The interim final rule revises the 

Schedule of Fees for Consular Services 

to reflect an increase in the surcharge 

related to consular services in support 

of enhanced border security and a 

reduction in the execution fee for the 

passport book.

The Department of State performed a costbenefit analysis in conjunction with this interim 

final rule. State determined that the net 

increase per application would provide State 

with an estimated additional $232 million in 

fiscal year 2008. State estimates that the 

increased cost of a passport book over its 10-

year lifetime will be minimal. Finally, State

estimates that the interim final rule will have 

the non-quantifiable benefit of enabling State

to advance its goal of enhancing border 

security while simultaneously investing in 

infrastructure and other developments needed 

to meet projected level of passport book 

demand in fiscal year 2008 and beyond.

Department of Transportation

99 Rule title: Hours of Service of 

Drivers 

Date: December 17, 2007

Sub-agency: Federal Motor Carrier 

Safety Administration (FMCSA)

Action: Interim final rule; request for 

comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report:

http://www.gao.gov/products/GAO-08

-390R

The interim final rule allows commercial 

motor vehicle drivers up to 11 hours of 

driving time within a 14-hour, nonextendable window from the start of the 

workday, following 10 consecutive 

hours off duty (11-hour limit). The 

interim final rule also allows motor 

carriers and drivers to restart calculation 

of the weekly on-duty time limits after 

the driver has at least 34 consecutive 

hours off duty (34-hour restart). The 

interim final rule was made in response 

to a decision by the United States Court 

of Appeals for the District of Columbia 

Circuit to vacate the portions of the 

2005 rule setting the 11-hour limit and 

the 34-hour restart. 

FMCSA updated the cost-benefit analysis it 

had prepared for the 2005 hours of service of 

drivers rule [70 Fed. Reg. 49,978 (Aug. 25, 

2005)] and included the analysis with the 

interim final rule. FMSCA determined that the 

analysis, as updated, continued to support 

setting the driving limit at 11 hours. FMCSA 

determined that setting the driving-limit at 10 

hours, as opposed to 11 hours, would have a 

benefit of reducing fatigue crash risk by 5.1 

percent, with an estimated value of $85 million 

per year, but that the costs in terms of 

productivity would be almost 2 percent, or an 

estimated $586 million, leaving a net cost of 

$501 million per year by eliminating the 11th 

hour.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 94 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

100 Rule title: Hours of Service of 

Drivers 

Date: November 19, 2008

Sub-agency: Federal Motor Carrier 

Safety Administration

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-222R

The final rule adopts as final provisions 

of an interim final rule concerning hours 

of service for commercial motor vehicle 

drivers. The final rule allows drivers to 

continue to drive up to 11 hours within a 

14-hour, non-extendable window from 

the start of the workday, following at 

least 10 consecutive hours off duty. The 

final rule also allows drivers to restart 

calculation of the weekly on-duty limits 

after a driver has at least 34 

consecutive hours off duty. 

FMCSA prepared a cost-benefit analysis 

comparing the current rule, which allows up to 

11 hours of driving, allows a new 7 or 8 day 

period to begin after a 34-hour restart break, 

and some splitting of off-duty periods using 

sleeper berths, to a second option that would 

limit driving to 10 hours in a tour of duty and 

eliminate the 34-hour restart provision. FMCSA 

estimated that the second option would result 

in decreased productivity yielding $2,443 

million in annual costs, and that it would 

reduce crash risk by approximately 0.63 

percent yielding a value of $214 million per 

year. Based on this analysis FMCSA 

concluded that the total annual net costs 

resulting from the second option would be 

approximately $2,229 million. FMCSA also 

conducted a series of sensitivity analyses, 

where it revised its assumptions regarding the 

percentage of all large truck crashes that are 

fatigue related, the value of a statistical life, 

and the relative risk of a fatigue-related crash 

in the 11th hour of driving. FMCSA combined 

all of the new assumptions in a way that 

makes the elimination of driving in the 11th 

hour more favorable from a cost-benefit 

analysis perspective, and the exercise still 

found the annual net costs of the second 

option to be $71 million. Based on its costbenefit analysis and its sensitivity analyses, 

FMCSA concluded that eliminating the 11th 

hour of driving is unlikely to be cost-effective 

under any reasonable set of circumstances.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 95 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

101 Rule title: Part 121 Pilot Age Limit

Date: July 15, 2009

Sub-agency: Federal Aviation 

Administration (FAA)

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-972R

The final rule amends certain 

regulations to conform with the “Fair 

Treatment for Experienced Pilots Act” 

by raising the upper age limit for pilots 

serving in domestic, flag, and 

supplemental operations from age 60 to 

age 65.

FAA performed a cost-benefit analysis in 

conjunction with the final rule, analyzing the 

costs and benefits of the final rule over a 15-

year period and summarizing the net benefits 

as the discounted present value of the stream 

of benefits and costs. FAA determined that the 

increase in the mandatory retirement age to 

age 65 will result in airlines and consumers 

incurring ‘‘real costs’’ (which reflect real 

resource use) and ‘‘transfer payments’’ (which 

are monetary payments from one group to 

another that do not affect total resources 

available to society) totaling $1.8 billion 

(present value) over 15 years. FAA determined 

that society will have a cost savings or net 

benefit of $334 million in terms of real resource 

use. In addition to the quantified benefits, FAA 

estimates that the final rule will result in an 

increase in the supply of pilots of 

approximately 12 percent over 5 years.

102 Rule title: Requirements and 

Procedures for Consumer Assistance 

To Recycle and Save Program

Date: July 29, 2009

Sub-agency: National Highway 

Traffic Safety Administration 

(NHTSA) 

Action: Final rule

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report:

http://www.gao.gov/products/GAO-09

-981R

The final rule sets forth the 

requirements and procedures for the 

voluntary vehicle trade-in and 

purchase/lease program under the 

Consumer Assistance to Recycle and 

Save Act of 2009 (commonly known as 

the Cash-for-Clunkers program). This 

program helps consumers pay for new, 

more fuel efficient cars and trucks from 

a participating dealer when they trade in 

a less fuel efficient car or truck. 

NHTSA analyzed the costs and benefits of this 

final rule. NHTSA stated that it plans to hire 30 

employees and more than 200 contractor 

employees to administer the program over 6 

months. NHTSA determined that the impact of 

the program governed by this rule will most 

likely not be large enough to increase 

production by manufacturers and that dealers 

will only be selling on average 12 additional 

vehicles. NHTSA identified the improved fuel 

efficiency of the on-road vehicle fleet as 

another benefit. NHTSA noted that this will 

decrease greenhouse gases and certain 

pollutants by decreasing fuel consumption, 

resulting in air pollution benefits. However, 

these benefits will be dependent upon which 

types of vehicles consumers purchase. 

According to NHTSA, dealers may incur 

certain costs, but that they may retain up to 

$50 from the scrap value of trade-in vehicles to 

offset administrative costs. Also, some related 

industries, such as automotive repair shops, 

may lose some profit due to foregone repairs.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 96 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

Department of the Treasury

103 Rule title: Unfair or Deceptive Acts 

or Practices; Amendment

Date: May 4, 2010

Sub-agency: Office of Thrift 

Supervision (OTS)

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-912R

The final rule amends the regulations on 

Prohibited Consumer Credit Practices, 

to avoid duplication and inconsistency 

with the Credit Card Accountability 

Responsibility and Disclosure Act of 

2009 and the rules of the Board of 

Governors of the Federal Reserve 

implementing that statute.

The rule did not include estimates of the costs, 

benefits, or transfer amounts.

OTS previously provided a regulatory impact 

analysis under Executive Order 12,866. 74 

Fed. Reg. at 5551—5558. OTS notes that the 

analysis addressed the impact of the 

consumer credit card practices in subpart C to 

part 535. Since this final rule removes subpart 

C, OTS states that its impact will be 

eliminated.

Department of Veterans Affairs 

(VA) 

104 Rule title: Traumatic Injury 

Protection Rider to Servicemembers’ 

Group Life Insurance

Date: March 8, 2007

Sub-agency: N/A

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-07

-619R

The final rule implements a statutory 

requirement to establish an automatic 

traumatic injury protection rider to the 

Service members’ Group Life Insurance 

program for any insured service 

member who sustains certain serious 

traumatic injuries.

VA included a cost benefit analysis with the 

publication of the interim final rule. VA 

estimated that the final rule will produce 

federal budgetary costs consisting of 

approximately $400 million in retroactive 

insurance payments, $68 million in start-up 

costs, and annual operating costs of 

approximately $68 million. The final rule will 

also increase the premium for service 

members by $1 per month. The final rule will 

provide benefits between $25,000 and 

$100,000 to qualifying service members who 

suffer a traumatic injury.

Federal Reserve System

105 Rule title: Capital Adequacy 

Guidelines: Treatment of Perpetual 

Preferred Stock Issued to the United 

States Treasury Under the 

Emergency Economic Stabilization 

Act of 2008

Date: October 22, 2008

Sub-agency: N/A

Action: Interim final rule with request 

for public comment.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-167R

The interim final rule permits bank 

holding companies that issue new 

senior perpetual preferred stock to the 

Treasury under the capital purchase 

program to include such capital 

instruments in Tier 1 capital for 

purposes of the Federal Reserve’s riskbased and leverage capital rules and 

guidelines for bank holding companies. 

The Federal Reserve did not prepare a costbenefit analysis. However, the interim final rule 

does explain that the Federal Reserve finds 

strong public policy considerations to allow 

Senior Perpetual Preferred Stock issued to 

Treasury under the Troubled Asset Relief 

Program to be included as Tier 1 capital for the 

purposes of the Federal Reserve’s risk-based 

and leverage capital rules and guidelines, as 

an exception to its longstanding stance 

regarding the unacceptability of a rate step-up 

in other regulatory capital instruments.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 97 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

106 Rule title: Capital Adequacy 

Guidelines; Small Bank Holding 

Company Policy Statement: 

Treatment of Subordinated Securities 

Issued to the United States Treasury 

Under the Emergency Economic 

Stabilization Act of 2008

Date: June 1, 2009

Sub-agency: Board of Governors of 

the Federal Reserve System (Board)

Action: Interim final rule with request 

for public comment.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-1033R

The interim final rule permits bank 

holding companies that have made a 

valid election to be taxed under 

Subchapter S of Chapter 1 of the U.S. 

Internal Revenue Code (S-Corp BHC) 

and bank holding companies organized 

in mutual form (Mutual BHC) to include 

the full amount of any new subordinated 

debt securities issued to the Treasury 

under the capital purchase program in 

Tier 1 capital for purposes of the 

Board’s risk-based and leverage capital 

guidelines for bank holding companies, 

provided that the Subordinated 

Securities will count toward the limit on 

the amount of other restricted core 

capital elements includable in Tier 1 

capital.

The Board did not prepare a cost-benefit 

analysis in conjunction with the interim final 

rule.

107 Rule title: Capital Adequacy 

Guidelines: Treatment of Perpetual 

Preferred Stock Issued to the United 

States Treasury Under the 

Emergency Economic Stabilization 

Act of 2008

Date: June 1, 2009

Sub-agency: Board of Governors of 

the Federal Reserve System (Board)

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-1034R

The final rule permits bank holding 

companies that issue new senior 

perpetual preferred stock to the 

Treasury under the capital purchase 

program announced by the Secretary of 

to include such capital instruments in 

Tier 1 capital for purposes of the 

Federal Reserve’s risk-based and 

leverage capital rules and guidelines for 

bank holding companies.

The Federal Reserve did not prepare a costbenefit analysis. However, the final rule does 

explain that the Federal Reserve finds strong 

public policy considerations to allow Senior 

Perpetual Preferred Stock issued to Treasury 

under the Troubled Asset Relief Program to be 

included as tier 1 capital for the purposes of 

the Federal Reserve’s risk-based and leverage 

capital rules and guidelines, as an exception to 

its longstanding stance regarding the 

unacceptability of a rate step-up in other 

regulatory capital instruments.

108 Rule title: Truth in Lending

Date: July 22, 2009

Sub-agency: Board of Governors of 

the Federal Reserve System (Board)

Action: Interim final rule; request for 

public comment.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-945R

The interim final rule amends 

Regulation Z in order to implement 

provisions of the Credit Card 

Accountability Responsibility and 

Disclosure Act of 2009 that are effective 

on August 20, 2009. The interim final 

rule pertains to advance notices of rate 

increases and changes in terms and the 

time consumers are given to make 

payments.

The Board did not prepare a cost-benefit 

analysis. However, the core provisions of this 

interim final rule implement the statutory 

requirements of section 102 of the Credit Card 

Act that are effective on August 20, 2009.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 98 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

109 Rule title: Electronic Fund Transfers

Date: August 17, 2010

Sub-agency: Board of Governors of 

the Federal Reserve System (Board)

Action: Interim final rule; request for 

public comment.

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-164R 

The interim final rule amends 

Regulation E, which implements the 

Electronic Fund Transfer Act, and the 

official staff commentary to the 

regulation, in order to implement 

legislation that modifies the effective 

date of certain disclosure requirements 

in the gift card provisions of the Credit 

Card Accountability Responsibility and 

Disclosure Act of 2009.

In its submission to the Comptroller General, 

the Board did not include a cost-benefit 

analysis.

Securities and Exchange 

Commission (SEC)

110 Rule title: Amendments to 

Regulation SHO

Date: October 17, 2008

Sub-agency: N/A

Action: Interim final temporary rule; 

request for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-236R

The interim final temporary rule 

addresses abusive “naked” short selling 

in all equity securities by requiring that 

participants of a clearing agency deliver 

securities by settlement date, or if the 

participants have not delivered shares 

by settlement date, immediately 

purchase or borrow securities to close 

out the fail to deliver position by no later 

than the beginning of regular trading 

hours on the settlement day following 

the day the participant incurred the fail 

to deliver position.

SEC prepared a cost-benefit analysis in 

conjunction with the interim final temporary 

rule. The rule will help maintain fair and orderly 

markets against the threat of sudden and 

excessive fluctuations of securities prices. 

SEC believes the interim final temporary rule 

will benefit investors by facilitating the receipt 

of shares so that more investors receive the 

benefits associated with ownership and 

ensuring confidence that trading can be 

conducted without the influence of illegal 

manipulation. SEC believes the interim final 

temporary rule will benefit issuers by 

increasing investor confidence in the market 

for their securities which will facilitate 

investments in their securities. SEC notes that 

the interim final temporary rule may result in 

increased short selling costs for investors and 

the securities lending market. However, SEC 

believes that the costs are justified by the fact 

that the temporary rule may help restore, 

maintain, and enhance investor confidence in 

the market by preventing potentially abusive 

“naked” short selling.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 99 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

111 Rule title: Disclosure of Short Sales 

and Short Positions by Institutional 

Investment Managers

Date: October 17, 2008

Sub-agency: N/A

Action: Final rule

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-137R

The interim final temporary rule adopts 

Exchange Act Rule 10a-3T which 

requires institutional investment 

managers that exercise investment 

discretion with respect to accounts 

holding section 13(f) securities having 

an aggregate fair market value of at 

least $100 million to file Form SH 

following a calendar week in which it 

effected a short sale in a section 13(f) 

security, with some exceptions.

SEC prepared a cost-benefit analysis in 

conjunction with the interim final temporary 

rule. SEC expects that Rule 10a-3T and Form 

SH will help restore investor confidence in the 

markets and reduce manipulative behavior, 

which should help to alleviate any undue crisis 

of investor confidence and may strengthen the 

market’s ability to correctly incorporate 

accurate information into securities prices. 

Also, the Form SH disclosure will enable staff 

to study the impact of short selling on the 

market in times of financial crisis. SEC 

estimates the costs will be $93.5 million in 

filing costs for the 1,000 Form SH Reports that 

will be filed with SEC each week through 

August 1, 2009. In addition, SEC notes that 

many institutional managers faced costs 

associated with creating a reporting 

mechanism to capture the data required by 

Form SH and will face association 

implementation costs.

112 Rule title: Internal Control Over 

Financial Reporting in Exchange Act 

Periodic Reports of Non-Accelerated 

Filers

Date: October 19, 2009

Sub-agency: N/A

Action: Final rules

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-177R

The final rule amends temporary rules1 

which extended compliance dates under 

the Sarbanes-Oxley Act of 2002. Under 

Section 404(b) of the act, companies 

that are non-accelerated filers are 

required to include in their annual 

reports an attestation report of their 

independent auditor on internal control 

over financial reporting (ICFR) for fiscal 

years ending on or after December 15, 

2009. The final rule postpones for an 

additional 6 months the date by which a 

non-accelerated filer must begin to 

include an auditor’s attestation report on 

ICFR with its annual report. 

The Commission states the benefits of this rule 

are that non-accelerated filers will be required 

to complete only management’s assessment of 

compliance with the Section 404 requirements 

during the deferral period. The final rule also 

allows non-accelerated filers more time to 

better prepare for compliance with the Section 

404(b) requirements and for the Section 404(b) 

audit to be properly planned, scoped and 

executed. The Commission states the cost of 

this rule is that investors in non-accelerated 

filers will have to wait longer than they would in 

the absence of the deferral for the assurances 

provided by the auditor’s attestation report and 

the added investor confidence that could result 

from obtaining an independent Section 404(b) 

attestation.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 100 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

113 Rule title: Reporting of SecurityBased Swap Transaction Data

Date: October 20, 2010

Sub-agency: N/A

Action: Interim final temporary rule; 

request for comments

Exception(s) to NPRM cited: Good 

cause (P)

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-173R

The interim final temporary rule requires 

specified counterparties to preenactment security-based swap 

transactions to report certain 

information relating to pre-enactment 

security-based swaps to a registered 

security-based swap data repository or 

to SEC by the compliance date 

established in the security-based swap 

reporting rules required under sections 

3C(e) and 13A(a) of the Securities 

Exchange Act of 1934 (‘‘Exchange 

Act’’), or within 60 days after a 

registered security-based swap data 

repository commences operations to 

receive and maintain data concerning 

such security-based swaps, whichever 

occurs first and report information 

relating to pre-enactment securitybased swaps to SEC upon request.

SEC performed a preliminary cost-benefit 

analysis in conjunction with the interim final 

temporary rule and requested comments on 

the costs and benefits. SEC determined that 

the interim final temporary rule will provide a 

means for SEC to gain a better understanding 

of the security-based swap markets and help 

SEC analyze the security-based swap market 

as a whole and identify risks. The interim final 

temporary rule will also facilitate the reports 

SEC is required to provide to Congress on 

security-based swaps and the security-based 

swaps marketplace, along with having possible 

benefits in encouraging management review of 

internal procedures and controls by market 

participants. SEC preliminarily estimates that 

the interim final temporary rule could affect 

more than 1,000 market participants and cover 

approximately 2.4 million security-based swap 

transactions. SEC preliminarily estimates that 

amending internal procedures, reprogramming 

systems, and implementing compliance 

processes to ensure that pre-enactment 

security-based swap transaction data is 

preserved could result in a cost to each 

respondent of approximately $6.236 and an 

aggregate cost of approximately $6.24 million. 

SEC preliminarily estimates that the 

requirement to report the transaction 

confirmation and time, if available, of execution 

could result in a cost to each reporting entity of 

approximately $43,900 and an aggregate cost 

of approximately $43.9 million. Finally, SEC 

preliminarily estimates that responding to SEC 

requests for information and documents could 

result in a cost to each reporting entity of 

approximately $6,352 and an aggregate cost 

of approximately $6.35 million.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 101 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

114 Rule title: Regulation SHO

Date: November 9, 2010

Sub-agency: N/A

Action: Final rule; extension of 

compliance date

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-11

-212R

The final rule extends for a limited 

period of time the compliance date for 

the amendments to Rule 201 and Rule 

200(g) of Regulation SHO from 

November 10, 2010, to February 28, 

2011. 

SEC generally considers the costs and 

benefits of its rules. According to the 

Commission, the delay of the compliance date 

for the amendments to Rule 201 and Rule 

200(g) of Regulation SHO will delay the 

benefits of the rules, but will also delay the 

ongoing costs of complying with the 

amendments. SEC determined that the limited 

extension is necessary and appropriate 

because it will provide certain exchanges 

additional time to modify their current 

procedures for conducting single-priced 

transactions for covered securities that have 

triggered Rule 201’s circuit breakers in a 

manner that is consistent with the goals and 

requirements of Rule 201, and industry 

participants additional time for programming 

and testing for compliance with the 

requirements of Rule 201 and Rule 200(g).

Joint rulemakings

115 Department of Defense; General 

Services Administration; National 

Aeronautics and Space 

Administration

Rule title: Federal Acquisition 

Regulation; FAR Case 2008–004, 

Prohibition on Restricted Business 

Operations in Sudan and Imports 

from Burma

Date: June 12, 2008

Sub-agency: N/A

Action: Interim rule with request for 

comments

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-08

-949R

The interim rule requires every contract 

entered into by an executive branch 

agency to contain a certification stating 

that the contractor does not conduct 

certain business operations in Sudan. In 

addition, this interim rule adds Burma to 

the list of countries from which most 

imports are prohibited.

The rule did not include estimates of the costs, 

benefits, or transfer amounts.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 102 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

116 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Final Rules for Group 

Health Plans and Health Insurance 

Issuers Under the Newborns’ and 

Mothers’ Health Protection Act

Date: October 20, 2008

Sub-agency: Internal Revenue 

Service; Employee Benefits Security 

Administration (EBSA); Centers for 

Medicare & Medicaid Services (CMS)

Action: Final rule

Exception(s) to NPRM cited: 

Statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-143R

The final rule provides protections for 

mothers and their newborn children with 

regard to the lengths of hospital stays 

following childbirth. By statute, group 

health plans and health insurance 

issuers generally may not restrict 

mothers’ and newborns’ benefits for a 

hospital stay in connection with 

childbirth to less than 48 hours following 

a vaginal delivery or 96 hours following 

a delivery by cesarean section.

EBSA and CMS analyzed the costs and 

benefits of this final rule. EBSA and CMS 

identified the primary economic benefit of the 

minimum length stays under this rule as 

deriving from the reduction in complications 

linked to the premature discharge of mothers 

and newborns. ESBA and CMS estimate the 

cost of enacting federal minimum stay 

requirements to be between $139 and $279 

million annually. However, because this final 

rule implements an already established 

statutory requirement, EBSA and CMS 

conclude that the implementation costs of this 

final rule should be negligible.

117 Department of Agriculture; 

Department of Commerce

Rule title: Broadband Initiatives 

Program; Broadband Technology 

Opportunities Program

Date: July 9, 2009

Sub-agency: Rural Utilities Service 

(RUS), Agriculture and National 

Telecommunications and Information 

Administration, Commerce (NTIA)

Action: Notice of Funds Availability 

(NOFA) and solicitation of 

applications

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-09

-907R

The notice announces general policy 

and application procedures for 

broadband initiatives established 

pursuant to the American Recovery and 

Reinvestment Act of 2009. In the notice, 

RUS establishes the Broadband 

Initiatives Program (BIP) which may 

extend loans, grants, and loan/grant 

combinations to facilitate broadband 

deployment in rural areas. In the notice, 

the NTIA establishes the Broadband 

Technology Opportunities Program 

(BTOP), which makes available grants 

for deploying broadband infrastructure 

in unserved and underserved areas in 

the United States, enhancing 

broadband capacity and public 

computer centers, and promoting 

sustainable broadband adoption 

programs.

RUS and NTIA prepared a cost-benefit 

analysis for the broadband initiatives 

announced in the notice. The costs associated 

with the notice were set by the Recovery Act in 

its appropriations for the programs. The 

Recovery Act appropriated $4.7 billion to NTIA 

for broadband grants and other programs. The 

Recovery Act also appropriated $2.5 billion to 

RUS for broadband grants and loans. The 

benefits include contributing toward stimulating 

the American economy by creating a variety of 

jobs for broadband equipment manufacturers 

and others. Also, the development of a faster, 

more extensive broadband infrastructure will 

help U.S. businesses operate more efficiently 

and better compete with businesses in foreign 

countries. In addition, the grants to public 

computer centers will allow vulnerable 

populations to take advantage of the benefits 

of broadband. Finally, the overall outreach 

efforts will help to alleviate the 

disenfranchisement of certain populations who 

are currently unaware of the benefits of 

broadband, cannot afford it, or do not know 

how to use a computer.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 103 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

118 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Interim Final Rules Under 

the Paul Wellstone and Pete 

Domenici Mental Health Parity and 

Addiction Equity Act of 2008

Date: February 2, 2010

Sub-agency: Internal Revenue 

Service; Employee Benefits Security 

Administration; Centers for Medicare 

& Medicaid Services

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-512R

The interim final rule requires parity 

between mental health or substance 

use disorder benefits and 

medical/surgical benefits with respect to 

financial requirements and treatment 

limitations under group health plans and 

health insurance coverage offered in

connection with a group health plan. 

The interim final rule also makes 

conforming changes to reflect statutory 

modifications regarding parity in 

aggregate lifetime and annual dollar 

limits, and incorporates new parity 

standards. 

The departments analyzed the costs and 

benefits of the rule. According to the 

departments, the costs include costs 

associated with increased utilization of mental 

health and substance use disorder benefits 

and costs associated with cumulative financial 

requirements and quantitative treatment 

limitations, including deductibles. Additionally, 

the departments include compliance review 

costs and costs associated with Paul 

Wellstone and Pete Domenici Mental Health 

Parity and Addiction Equity Act of 2008 

(MHPAEA) disclosures. The departments 

expect that the largest benefit associated with 

MHPAEA and these regulations will be derived 

from applying parity to cumulative quantitative 

treatment limitations such as annual or lifetime 

day or visit limits (visit limitations) to help 

ensure that vulnerable populations—those 

accessing substantial amounts of mental 

health and substance use disorder services—

have better access to appropriate care. The 

departments cannot estimate how large this 

benefit will be, because sufficient data is not 

available to estimate the number of covered 

individuals that had their benefits terminated 

because they reached their coverage limit. The 

departments state that another potential 

benefit associated with MHPAEA and these 

regulations is that use of mental health and 

substance use disorder benefits could 

improve. The departments note that the finding 

that treatment can help increase the 

productivity of those suffering from mental 

illness suggests that increasing access to 

treatment of mental disorders could have a 

beneficial impact on lost productivity cost and 

lost earnings that stem from untreated and 

under treated mental health conditions and 

substance use disorders. The departments, 

however, do not have sufficient data to 

determine whether this result will occur, and, if 

it does, the extent to which lost productivity 

cost and lost earnings could improve. 

According to the departments, because 

expenditures on mental health and substance 

use disorder benefits only comprise 3-6 

percent of the total benefits covered by a 
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 104 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

group health plan and 8 percent of overall 

healthcare costs, the departments expect that 

group health plans will lower cost-sharing on 

mental health and substance use disorder 

benefits instead of raising cost-sharing on 

medical/surgical benefits. (Over the 10-year 

period of 2010 to 2019, the total undiscounted

cost of the rule is estimated to be $115 million 

in 2010 dollars. The departments also 

estimated a transfer of $25.6 billion over the 

10-year period.)

119 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Interim Final Rules for 

Group Health Plans and Health 

Insurance Issuers Relating to 

Dependent Coverage of Children to 

Age 26 Under the Patient Protection 

and Affordable Care Act

Date: May 13, 2010

Sub-agency: Internal Revenue 

Service (IRS); Employee Benefits 

Security Administration (EBSA); & 

Office of the Secretary

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-760R

These interim final rules implement 

statutory requirements for group health 

plans and health insurance issuers in 

the group and individual markets under 

provisions of the Patient Protection and 

Affordable Care Act regarding 

dependent coverage of children who 

have not attained age 26. This rule 

clarifies that, with respect to children 

who have not attained age 26, a plan or 

issuer may not define dependent for the 

purposes of eligibility for dependent 

coverage of children other than in terms 

of the relationship between the child 

and the participant (in the individual 

market, the primary subscriber).

The Internal Revenue Service, EBSA, and 

Department of Health and Human Services, 

Office of the Secretary, analyzed the costs and 

benefits of these interim final rules. The 

agencies determined that the benefits are 

expected to outweigh the costs to the 

regulated community. For 2011, the agencies 

estimated the number of previously uninsured 

individuals who will be covered under their 

parents’ coverage. The agencies estimated 

that under their low-range assumptions, 

190,000 such individuals would be covered; 

under their mid-range assumptions, 650,000 

such individuals; and under their high-range 

assumptions, 1.64 million such individuals. 

According to the agencies, expanding 

coverage options for the 19 - to - 25 year old 

population should decrease the number 

uninsured, which in turn should decrease the 

cost-shifting of uncompensated care onto 

those with coverage, increase the receipt of 

preventive health care, and provide more 

timely access to high quality care, resulting in 

a healthier population. In particular, the 

agencies predict children with chronic 

conditions or other serious health issues will 

be able to continue coverage through a 

parents’ plan until age 26. The agencies also 

expect that allowing extended dependent 

coverage will permit greater job mobility for this 

population as their health coverage will no 

longer be tied to their own jobs or student 

status. The agencies estimated the annual 

monetized costs of these interim final rules for 

2011 through 2013 to be $11.2 million at a 

discount rate of 7 percent and $10.4 million at 

a discount rate of 3 percent.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 105 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

120 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Interim Final Rules for 

Group Health Plans and Health 

Insurance Coverage Relating to 

Status as a Grandfathered Health 

Plan Under the Patient Protection 

and Affordable Care Act

Date: June 17, 2010

Sub-agency: Internal Revenue 

Service, Employee Benefits Security 

Administration, Office of Consumer 

Information and Insurance Oversight

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-878R

The interim final rules implement 

statutory requirements for group health 

plans and health insurance coverage in 

the group and individual markets under 

provisions of the Affordable Care Act 

regarding status as a grandfathered 

health plan. These interim final 

regulations allow family members of 

individuals already enrolled in a 

grandfathered health plan to enroll in 

the plan after March 23, 2010; in such 

cases, the plan or coverage is also a 

grandfathered health plan with respect 

to the family members. New employees 

(whether newly hired or newly enrolled) 

and their families can enroll in a 

grandfathered group health plan after 

March 23, 2010, without affecting status 

as a grandfathered health plan.

With an estimated 2.2 million grandfathered 

plans in 2011, EBSA and the Internal Revenue 

Service estimate an hour burden of 

approximately 538,000 hours with equivalent 

costs of $30.7 million. The departments have 

estimated this as a one-time cost incurred in 

2011, because after the first year, the 

departments anticipate that any future costs 

will be de minimis. Overall, for both the 

grandfathering notice and the recordkeeping 

requirement, the departments expect there to 

be a total hour burden of 1.1 million hours and 

a cost burden of $291,000. With an estimated 

98,000 grandfathered plans and 7,400 

grandfathered individual insurance products in 

2011, HHS estimates an hour burden of 

approximately 26,000 hours with equivalent 

costs of $1.5 million. HHS has estimated this 

as a one-time cost incurred in 2011, because 

after the first year, HHS assumes any future 

costs will be de minimis. Overall, for both the 

grandfathering notice and the recordkeeping 

requirement, HHS expects there to be a total 

hour burden of 53,000 hours and a cost 

burden of $318,000.

(The departments also identified qualitative 

benefits including that the existence of 

grandfathered health plans will provide 

individuals with the benefits of plan continuity, 

could potentially slow the rate of premium 

growth, depending on the extent to which their 

current plan does not include the benefits and 

protections of the new law, and could also 

provide incentives to employers to continue 

coverage, potentially reducing new Medicaid 

enrollment and spending and lowering the 

number of uninsured individuals. According to 

the departments, these interim final regulations 

also provide greater certainty for plans and 

issuers about what changes they can make 

without affecting their grandfather status. The 

departments concluded that, as compared with 

alternative approaches, these regulations 

provide significant economic and noneconomic 

benefits to both issuers and beneficiaries, 

though these benefits cannot be quantified at 

this time)
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 106 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

121 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Patient Protection and 

Affordable Care Act: Preexisting 

Condition Exclusions, Lifetime and 

Annual Limits, Rescissions, and 

Patient Protections

Date: June 28, 2010

Sub-agency: Internal Revenue 

Service, Department of the Treasury; 

Employee Benefits Security 

Administration, Department of Labor; 

Office of Consumer Information and 

Insurance, Department of Health and 

Human Services

Action: Interim final rules with 

request for comments.

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-897R

These interim final rules implement the 

requirements for group health plans and 

health insurance coverage in the group 

and individual markets under provisions 

of the Patient Protection and Affordable 

Care Act regarding preexisting condition 

exclusions, lifetime and annual dollar 

limits on benefits, rescissions, and 

patient protections. 

The Internal Revenue Service, EBSA, and 

HHS analyzed the costs and benefits of these 

interim final rules. The agencies stated that 

they crafted these interim final rules in the 

most economically efficient manner possible. 

The agencies estimate that these interim final 

rules will have an annual monetized cost of 

$4.9 million from 2011 to 2013.

The agencies expect these interim final rules 

will expand coverage for children with 

preexisting conditions and individuals who face 

rescissions, lifetime limits, and annual limits as 

a result of high health care costs. The 

agencies expect these benefits to manifest in a 

number of ways including: (1) increasing 

access to health care, improving health 

outcomes, improving worker productivity, and 

reducing family financial strain and “job lock”; 

(2) promoting equity, in the sense that the 

benefits will be enjoyed by those who are 

especially vulnerable as a result of health 

problems and financial status; (3) building 

better, sustained patient-provider relationships 

through choice of physician, resulting in 

decreased malpractice claims and improved 

medication adherence and health promotion; 

and (4) reducing administrative and time 

burdens on both patients and physicians while 

improving health outcomes by allowing quicker 

access to medical services when necessary by 

removing referrals and prior authorizations for 

primary care, obstetrical and gynecological 

care, and emergency services.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 107 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

122 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Interim Final Rules for 

Group Health Plans and Health 

Insurance Issuers Relating to 

Coverage of Preventive Services 

Under the Patient Protection and 

Affordable Care Act

Date: July 19, 2010

Sub-agency: Internal Revenue 

Service; Employee Benefits Security 

Administration; Office of Consumer 

Information and Insurance Oversight

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-958R

These interim final rules implement the 

rules for group health plans and health 

insurance coverage in the group and 

individual markets under provisions of 

the Patient Protection and Affordable 

Care Act regarding preventive health 

services. These interim final rules 

generally apply to group health plans, 

group health insurance issuers, and 

individual health insurance issuers for 

plan years beginning on or after 

September 23, 2010.

The agencies analyzed the potential costs and 

benefits of these interim final regulations. The 

agencies anticipate the qualitative costs from 

2011 to 2013 to include new costs to the 

health care system resulting when 

beneficiaries increase their use of preventive 

services in response to the changes in 

coverage and cost-sharing requirements of 

preventive services. The agencies note that 

the magnitude of this effect on utilization 

depends on the price elasticity of demand and 

the percentage change in prices facing those 

with reduced cost sharing or newly gaining 

coverage. The agencies anticipate four 

qualitative benefits from 2011 to 2013. First, 

individuals will experience improved health as 

a result of reduced transmission, prevention or 

delayed onset, and earlier treatment of 

disease. Second, healthier workers and 

children will be more productive with fewer 

missed days of work or school. Third, some of 

the recommended preventive services will 

result in savings due to lower health care 

costs. Fourth, the cost of preventive services 

will be distributed more equitably.
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 108 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

123 Department of the Treasury; 

Department of Labor; Department of 

Health and Human Services

Rule title: Interim Final Rules for 

Group Health Plans and Health 

Insurance Issuers Relating to Internal 

Claims and Appeals and External 

Review Processes Under the Patient 

Protection and Affordable Care Act

Date: July 23, 2010

Sub-agency: Internal Revenue 

Service; Employee Benefits Security 

Administration; and Office of

Consumer Information; Insurance 

Oversight

Action: Interim final rules with 

request for comments

Exception(s) to NPRM cited: Good 

cause; statutory

GAO major rule report: 

http://www.gao.gov/products/GAO-10

-989R

These interim final rules implement the 

requirements regarding internal claims 

and appeals and external review 

processes for group health plans and 

health insurance coverage in the group 

and individual markets. The regulations 

will generally affect health insurance 

issuers; group health plans; and 

participants, beneficiaries, and enrollees 

in health insurance coverage and in 

group health plans. These rules will 

generally apply to group health plans, 

group health insurance issuers, and 

individual insurance issuers for plan 

years beginning on or after September 

23, 2010.

The Internal Revenue Service, EBSA, and 

HHS analyzed the costs and benefits of this 

final rule. In assessing the benefits of this rule, 

the agencies found the following: A more 

uniform, rigorous, and consumer friendly 

system of claims and appeals processing will 

provide a broad range of direct and indirect 

benefits that will accrue to varying degrees to 

all of the affected parties. These interim final 

regulations could improve the extent to which 

employee benefit plans provide benefits 

consistent with the established terms of 

individual plans. While payment of these 

benefits will largely constitute transfers, the 

transfers will be welfare improving, because 

incorrectly denied benefits will be paid. Greater 

certainty and consistency in the handling of 

benefit claims and appeals and improved 

access to information about the manner in 

which claims and appeals are adjudicated 

should lead to efficiency gains in the system, 

both in terms of the allocation of spending 

across plans and enrollees as well as 

operational efficiencies among individual 

plans. This certainty and consistency can also 

be expected to benefit, to varying degrees, all 

parties within the system, particularly 

consumers, and to lead to broader social 

welfare gains.

The agencies estimated the costs of this rule 

to (1) administer and conduct the internal and 

external review process, (2) prepare and 

distribute required disclosures and notices, 

and (3) bring plan and issuers’ internal and 

external claims and appeals procedures into 

compliance with the new requirements. The 

agencies estimate these costs to be between 

$51.2 million and $51.6 million per year for the 

period 2011 to 2013, depending on the 

discount rate. The agencies also estimated the 

dollar amount of claim denials reversed in the 

external review process. While this amount is a 

cost to plans, it represents a payment of 

benefits that should have previously been paid 

to participants, but was denied. Part of this 

amount is a transfer from plans and issuers to 

those now receiving payment for denied 

benefits. These transfers will improve equity, 

because incorrectly denied benefits will be 

paid. Part of the amount could also be a cost if 

the reversal leads to services and hence 
Appendix IV: Summary Information on Final 

Major Rules Issued without an NPRM, in Whole 

or in Part—2003 through 2010

Page 109 GAO-13-21 Federal Rulemaking

Rule Description

Summary of benefits, costs, and other 

economic effects 

resources being utilized now that had been 

denied previously. The agencies estimated the

amount attributable to reversals to be between 

$24.4 million and $24.7 million per year for the

period 2011 to 2013, depending on the 

discount rate.

Source: GAO.
Appendix V: Comments from the Office of 

Management and Budget

Page 110 GAO-13-21 Federal Rulemaking

Appendix V: Comments from the Office of 

Management and Budget
Appendix V: Comments from the Office of 

Management and Budget

Page 111 GAO-13-21 Federal Rulemaking
Appendix VI: GAO Contacts and Staff 

Acknowledgments

Page 112 GAO-13-21 Federal Rulemaking

Melissa Emrey-Arras, (617) 788-0534 or emreyarrasm@gao.gov

Robert Cramer, (202) 512-7227 or cramerr@gao.gov

In addition to the individuals named above, Tom Beall, Tim Bober, Sara 

Daleski, Janet Dolen, Clifton G. Douglas Jr., Denise Fantone, Rob 

Gebhart, Tim Guinane, Lois Hanshaw, Shirley Jones, Andrea Levine, 

Donna Miller, Mark Ramage, Beverly Ross, Cynthia Saunders, Wesley 

Sholtes, Lou V.B. Smith, Andrew Stephens, and Sabrina Streagle made 

key contributions to this report.

Appendix VI: GAO Contacts and Staff 

Acknowledgments 

GAO Contacts

Staff 

Acknowledgments 

(450906)
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