The Broader Impacts of Loper Bright Enterprises v. Raimondo
BY SKYLAR DAVELINE
Image Credits: Tupungato on stock.adobe.com
In June of 2024, the Supreme Court decided the landmark case Loper Bright Enterprises v. Raimondo, fundamentally reshaping administrative law and ending the 40-year-long reign of the Chevron doctrine. First established in the 1984 case Chevron U.S., Inc. v. Natural Resources Defense Council, Inc., Chevron deference gave federal agencies the authority to provide reasonable interpretations of ambiguous federal statutes as long as Congress had not explicitly addressed the issue. This doctrine became a foundation of administrative law, granting broad power to federal agencies while restraining judicial power.
Chevron deference is rooted in the Supreme Court’s decision to uphold the Environmental Protection Agency’s (EPA) interpretation of the Clean Air Act Amendments of 1977. These amendments required states with poor air quality to regulate "new or modified major stationary sources" of pollution, such as power plants and factories. This introduced the “bubble concept,” which allowed states to treat all pollution-emitting devices within a facility as a single source for regulatory purposes. Ultimately, it decided that plants may implement or adjust a single piece of equipment without a permit if it will not emit more air pollution from the plant. While lower courts rejected this interpretation, the Supreme Court established a two-step framework for judicial review of agency decisions. The Chevron test required courts first to determine if Congress had directly addressed the issue and, if not, to defer to any reasonable agency interpretation.
In Loper Bright four decades later, the Supreme Court decided the National Marine Fisheries Service’s rule that required commercial fishermen to fund at-sea monitoring programs was unconstitutional. The Court used the Administrative Procedure Act (APA) as the basis of its decision, which states that courts must independently "decide all relevant questions of law" when evaluating agency actions. Because of this APA standard, the Court ruled that the Chevron doctrine is unlawful, ultimately rejecting the assumption that statute ambiguity signaled congressional intent to delegate interpretive authority to agencies. Although the Court overruled Chevron, they made it clear that past cases that used Chevron are not instantly overruled. They declared that the lawfulness of those rulings must be challenged separately.
With the removal of Chevron deference, the balance of power has shifted between executive agencies and the judiciary, raising significant questions about current laws that have long been under agency discretion. Though these laws are not immediately erased, they will likely be challenged individually. Ultimately, this change in administrative law will have broader implications concerning healthcare and the environment. As US agencies lose the deference that empowered them to craft nuanced and technically sound policies, the resulting challenges and uncertainty may lead to weakened protections, regulatory gridlock, and inconsistent rulings across these critical sectors.
Chevron and Agency Expertise
The death of Chevron deference will have expansive effects on the public, particularly in sectors that rely on the expertise of federal agencies for regulations, including healthcare and the environment. Without Chevron, Congress is granted the responsibility of creating highly specific legislation on technical issues they are unqualified to take on. Ultimately, the legislative branch lacks the necessary resources to fulfill this task. With less than half of congressional staff holding advanced degrees and their high turnover rates, there is limited experience and knowledge in these key fields of education and health. In contrast, healthcare and environmental agencies have highly experienced and senior staff who are experts in their field, allowing them in-depth knowledge about the policies and issues in question. Furthermore, Congress simply does not have access to adequate research and resources needed to make sufficient regulations. On the other hand, executive agencies are given 120 times the funding of the legislative branch. They are the only branch that is given the resources necessary to carry out and adopt regulations following the best and newest data. Moreover, the end of Chevron deference grants judges the responsibility to interpret ambiguous policy rather than the agencies. Just like Congress, the judicial branch has little expertise on matters of the environment and healthcare compared to agencies. The new shift of power will ultimately lead to imprecise regulations that do not account for the intricacies of healthcare and environmental protection, creating inadequate management of these areas. United States citizens will pay the most significant price.
Healthcare
The elimination of Chevron deference could significantly spoil the ability of federal agencies to regulate critical public health issues, creating broad consequences for healthcare access, innovation and administrative efficiency.
Medicare and Medicaid could face significant threats. Without Chevron, healthcare could see a rise in reimbursement and coverage disputes, leaving patients vulnerable to limited insurance for essential treatments. Under Chevron deference, Medicare and Medicaid reimbursements and coverage have historically involved complex regulatory questions interpreted by federal agencies like the Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS). With the end of Chevron, agencies have lost this deference, leaving providers with the grounds to challenge long-standing interpretations that have put them at a disadvantage. Hospitals claiming they have lost billions of dollars from these strict interpretations have already taken legal action to loosen regulations since the Loper Bright decision. In some instances, they have already won their disputes. Even if these disputes do not lead to providers’ ideal decision, disputes may still delay access to reimbursements and coverage. If this trend continues, people will be left with severe threats to their medical treatments. While providers will hold on to more money than they have since the rise of Chevron, people will be forced to pay for an increased amount of their healthcare needs out of pocket.
Overall, the end of Chevron deference could disrupt the system of Medicare and Medicaid. In effect, healthcare litigation will increase from organizations and beneficiaries challenging agency decisions who have been restricted and regulated by current agency interpretations. This will in effect overwhelm agencies, delay policy implementation, and increase costs for all parties involved. Further, with judges’ authority to interpret health statutes under Medicare and Medicaid, court decisions will become inconsistent. Courts across jurisdictions will regulate health coverage differently, with this lack of cohesion making policy unpredictable and too complex for both providers and patients to understand. Without settlement, litigation and judge interpretation could disrupt the consistent healthcare benefits many enjoy currently.
The Supreme Court’s overturning of the Chevron doctrine could harm efforts to lower drug prices. Under the Inflation Reduction Act (IRA), CMS has had the authority to negotiate the prices of certain high-cost drugs that are covered by Medicare. However, without Chevron deference, CMS may face legal challenges from pharmaceutical companies over its interpretation of the IRA, leading to the delay or even the obstruction of the negotiation process. In turn, efforts to reduce prescription drug costs could be threatened. Although the IRA’s drug pricing statutes are popular, the loss of Chevron could lead to courts restricting the extent to which CMS is able to interpret and implement the IRA’s law. With an increased role of judicial deference and the likelihood of litigation, CMS may be deterred from taking bold actions, weakening its ability to lower Medicare drug costs.
Further, the rejection of Chevron will disproportionately harm minorities. Since Loper Bright, nondiscrimination protections under the Affordable Care Act have already been damaged, shedding light on what will come. Courts in Mississippi, Florida, and Texas have struck down Biden Administration regulations under Section 1557 to include gender identity in the definition of sex discrimination and prohibit health plans from excluding gender-affirming care from coverage outright. These court cases signal the eagerness of courts to end agency interpretations of nondiscrimination regulations and an era where courts increasingly limit the federal government’s ability to enforce inclusive policies and roll back progressive healthcare equity.
The loss of Chevron deference creates unclarity in healthcare regulation, which stifles innovation. Increased legal challenges and unpredictable regulatory shifts could delay agency approval for new medical treatments. As a result, startups and smaller biotech firms—often the drivers of medical innovation—may face heightened financial and legal burdens as they navigate a more complex and contentious regulatory environment. Unlike larger corporations with established resources, these smaller entities could struggle to absorb the costs of prolonged litigation or uncertainty around compliance requirements, ultimately discouraging risk-taking and investment in breakthrough healthcare technologies. The inhibition of innovation could lead to slower advancements in medical science, depriving patients of timely access to life-saving treatments.
The end of Chevron deference will create significant threats to the healthcare system, impacting access to essential treatments and drug pricing to innovation in the medical field. With courts increasingly empowered to challenge federal agency interpretations, healthcare litigation is expected to rise, potentially delaying policy implementation and creating an unpredictable environment for both providers and patients. This uncertainty could exacerbate inequalities in healthcare access, hinder progress in medical innovations, and threaten the consistency and efficiency of Medicare and Medicaid. Ultimately, the loss of Chevron could undermine efforts to improve public health and burden patients and providers with higher costs and declined healthcare quality.
Environment
Chevron deference has allowed the Environmental Protection Agency (EPA) to use its scientific and technical expertise to broadly address environmental challenges effectively for decades. Through this doctrine, the EPA implemented critical regulations for climate change and other environmental challenges, including efforts to control greenhouse gases, advance conservation efforts, and modernize water-quality standards. These measures have been critical to protect the U.S. and the world from environmental degradation. Without Chevron, these protections are at risk.
Until the overrule of Chevron, the Clean Air Act, which relies on Chevron deference, has been used to pass extensive regulations to control air pollution by the EPA. Because of the EPA’s broad interpretation of the act, the Clean Air Act has significantly improved air quality and reduced pollutants in the U.S. However, without Chevron, the EPA’s interpretation of the act could be cut by courts, effectively limiting its ability to regulate emerging environmental threats. Conservative courts will interpret the Clean Air Act in less ambitious ways, cutting back the progressive regulations by the EPA. Further, it could lead to more cautious and less ambitious regulations, as agencies would need to consider how courts might interpret vague or ambiguous statutes.
Further, water quality regulation has relied on the EPA’s scientific expertise to set critical standards under the Clean Water Act (CWA). Without Chevron, courts may set stricter interpretations, reducing the EPA’s ability to address water pollution to the greatest extent. The CWA was intentionally designed with broad and ambiguous definitions to empower agencies to regulate “waters of the United States” (WOTUS), including wetlands. With Chevron deference, courts upheld agency interpretation to address water pollution. However, without Chevron, courts are less likely to defer to the Environmental Protection Agency’s (EPA) interpretation of jurisdictional terms, such as "adjacent wetlands." This shift undermines the legislative intent of the CWA, empowering conservative courts to limit the waters protected by the government. By adopting restrictive interpretations, courts risk creating fragmented jurisdictional standards, leading to the loss of federal protection.
The EPA has also taken steps to regulate per- and poly-fluoroalkyl substances (PFAS), or “forever chemicals,” under Chevron deference. Just like the name suggests, these toxic chemicals remain in the environment forever and have been found in frightening numbers in human bodies, posing severe health risks. Under Chevron, the EPA has created limits on PFAS in drinking water and has held manufacturers accountable for contamination. With the eradication of Chevron, these limits could suffer challenges and litigation, delaying crucial action necessary to prevent PFAS.
The removal of Chevron deference will shift deference from an expert agency to the courts and Congress. Because of this, decisions will be more influenced by political questions rather than scientific evidence. With a Republican majority in the House and Senate and six of nine justices being conservative, loosening or a total rollback of these crucial environmental regulations is likely to occur. This change could result in weaker enforcement of clean air and water standards, reduced polluter accountability, and weakened efforts to combat climate change. Further, eliminating Chevron could create uncertainty for industries seeking guidance on compliance, slowing innovation, and sustainable development.
This article was edited by Kyle Nguyen and Abigail Williams.