From “The how we need now: A capacity agenda for 2025 and beyond,” published by the Niskanen Center think tank:
We need a new operating model for government if we are to restore our capacity to achieve our policy goals. This model must close the open loop we described in Part 3: a one-way system from law- and policy-making to implementation to real world outcomes that offers little space for learning and adjustment along the way. We can no longer rely on media coverage and elections, blunt tools that tend to be saved only for the most catastrophic errors, as the main corrective mechanisms.
Closing the loop means that we must apply test-and-learn approaches. This means conducting multiple small-scale experiments at the boundaries of policy and delivery — and doing this permanently, in pursuit of a policy intent or outcome. Incremental changes are scaled up once there is good evidence they work in reality. Test-and-learn does not mean simply running lots of pilots. A pilot implies starting with a phase for learning, which then ends as you move into “roll out.” Responsiveness is an embedded attribute, not a phase on a timeline. Closing the loop means the learning doesn’t stop at an arbitrary moment.
We briefly touched on this paper before and the concept of the Cascade of Rigidity “that occurs when well-intentioned laws and regulations become increasingly inflexible as they step down through bureaucratic hierarchies.” They discuss a healthcare-related Open Loop error with MACRA:
MACRA (Medicare Access and CHIP Reauthorization Act) was designed to pay doctors more for higher-quality care. But an implementation team at the Centers for Medicare and Medicaid Services (CMS) knew that doctors were already frustrated with the burdensome and confusing ways they had to report their data under the existing program, and many were so concerned that the new system would be just as bad that they were threatening to stop taking Medicare patients. Thus, a law designed to improve the quality of care threatened to degrade it, especially for patients in rural areas who relied on the small practices that were most affected.
Recognizing how challenging the administrative requirements could be for practices with fewer resources and limited Medicare revenue, one provision in the law exempted doctors who treated a minimal number of Medicare patients. But CMS’s initial interpretation of this provision would have required all providers to collect and submit a full year’s worth of data in order to demonstrate they fell below the exemption threshold. This meant exempt doctors would still have to comply with all the program’s requirements, including updating their systems and reporting data, only to be excused from all this at a later date. It’s not hard to see why this approach, while technically accurate, would have worked against the intent of lawmakers. Those doctors would have left the program, hurting the very patients the law meant to help.
Another provision allowed smaller practices to form “virtual groups” to gain advantages enjoyed by larger practices. Staff interpreted this provision as a mandate to create a “Facebook for Doctors,” a platform for doctors to find and connect with each other. A staffer on loan from the United States Digital Service, a part of the White House, doubted that Congress intended for CMS to create a social media platform, especially considering the limited time and resources available. She took the almost unheard of step of consulting the House Office of the Legislative Counsel, and confirmed that Congress simply wanted to make it easier for small practices to report together and had no intention of mandating a “Facebook for Doctors.”
Under more common circumstances, these and other overly literal interpretations of the law would have resulted in a burdensome, unwieldy, and ultimately unsuccessful implementation. Doctors would have simply opted out, leaving patients with fewer options, and some in rural areas with none.
Thanks to nimble actions by people at CMS and USDS to ensure that Congressional intent was realized rather than over-relying on literal interpretations, this outcome was avoided. But conflicts like these all too rarely resolve in favor of common sense. Agency staff are commonly taught to treat legal language as literal operating instructions, as if a programmer had written code and they were the computer executing that code. But as any programmer will tell you, code rarely works as intended on the first try. It works after trying one approach, testing it, adjusting, and continuing that cycle over and over again. That cycle of adjustment is very difficult to engineer within policy implementation today.
We run on an open loop, in which implementation teams neither test their programs in the real world nor loop back to the source for adjustments. We need to build the affordances for them to do both, thus closing the loop. Otherwise, the code will more often than not run exactly as Congress wrote it, even if that doesn’t result in what Congress wanted.
This is emblematic of the problem and also insane: a government-created Facebook alternative for doctors for the express purpose of dealing with a procedural nightmare created by a well-intentioned but completely untested, unproven, almost certainly unhelpful, and very gameable quality goals.