The end of Chevron
August 2024—In a recent landmark decision, the Supreme Court of the United States overruled the longstanding Chevron doctrine, a judicial precedent that has been foundational to administrative law and regulatory practice for four decades. This decision has profound implications for regulations promulgated by the hundreds of federal agencies. For laboratory professionals, understanding this decision will be valuable in understanding how the landscape will change.
Chevron deference originated from the 1984 SCOTUS case Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. In a case focused on clean air regulations, SCOTUS created a broad two-step test for courts in determining whether an agency’s regulations would be upheld:
1. Determine whether Congress has spoken directly on the issue. If yes and the statute is clear and unambiguous, the interpretation must be followed.
2. If the statute is ambiguous, determine whether the agency’s interpretation is reasonable. If reasonable, the court should defer to the agency’s interpretation.
Long a point of contention, the doctrine allowed federal agencies significant leeway in interpreting congressional statutes and promulgating regulations.
The recent SCOTUS decision in Loper Bright Enterprises v. Raimondo marks a notable change, with the court’s majority opinion arguing that the doctrine had led to excessive power and a general lack of accountability for agencies. Without Chevron deference, courts will now more rigorously scrutinize agency interpretations, curtailing agency power without clear congressional language. Removing Chevron deference will introduce uncertainty into regulatory policies. Agencies such as the Centers for Medicare and Medicaid Services, Food and Drug Administration, and Centers for Disease Control and Prevention play pivotal roles in setting standards for clinical laboratories and approving medical devices and diagnostics.
One likely outcome will be an increase in legal challenges to agency regulations. For new regulations, this will likely prolong time to implement changes. Existing regulations, which were shielded by Chevron, may be struck down by courts. With 94 federal district courts and 12 regional circuits, it could lead to a fragmented regulatory environment.
Laboratory professionals are accustomed to following guidelines and standards, such as those set by the Clinical Laboratory Improvement Amendments. If the regulatory agencies’ authority is cut back, the process of updating and enforcing these standards may become slower and more challenging.
With this ruling, it seems certain that the FDA’s final rule on laboratory-developed tests will be challenged. Regardless of the outcome of that litigation, it seems likely to delay implementation of the four-year process as laid out.
With the overturning of Chevron, Congress will need to be more detailed and explicit in legislation to be carried out by agencies. While many, including supporters of Chevron, would agree that this approach would lead to greater stability and predictability in regulations, it seems unlikely. Cooperation on legislation is difficult in the best of times, with the current (118th) Congress enacting only 65 bills (the 104th Congress had the next lowest number of enacted bills with 430).
Bradley Grant, MD, JD
Assistant Professor
Department of Pathology
University of Texas Medical Branch
Galveston
Editor’s note: Jane Pine Wood of McDonald Hopkins LLC, who provided extensive commentary on the LDT final rule in the July issue (https://bit.ly/CT_0724-LDT), offers the following about the preceding letter and Loper Bright Enterprises v. Raimondo: I agree with the legal analysis with respect to the implications of Loper Bright Enterprises v. Raimondo for future review of agency rulemaking. More specifically, with respect to the ACLA/HealthTrackRx challenge to the FDA’s final rule, I believe this decision will strengthen the plaintiffs’ arguments.