The National Consumer Law Center responded quickly and critically, noting that "the Office of the Comptroller of the Currency (OCC), in its final rule implementing the preemption amendments of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, continues to thumb its nose at state efforts to protect consumers. The agency gives national banks immunity from state laws protecting consumers from abusive mortgage, credit card and overdraft fee practices." Go here to see NCLC's comments on the proposed rules.
OCC Issues Final Rule to Implement Provisions of the Dodd-Frank Act
WASHINGTON — The Office of the Comptroller of the Currency today issued a final rule implementing several provisions of the Dodd-Frank Act, including changes to facilitate the transfer of functions from the Office of Thrift Supervision and revisions to the OCC’s rules on preemption and visitorial powers. The OCC issued a notice of proposed rulemaking for this final rule on May 26, 2011.
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the OCC assumes responsibility for the ongoing examination, supervision, and regulation of federal savings associations on July 21.
This final rule contains changes to the OCC’s regulations necessary to implement certain revisions to the banking laws that took effect on the enactment of the Dodd-Frank Act. These changes include amendments to OCC rules pertaining to preemption and visitorial powers.
The preemption and visitorial-powers amendments:
- Eliminate preemption for operating subsidiaries of national banks and operating subsidiaries of Federal savings associations;
- Apply to federal thrifts the same preemption standard – that is, a conflict preemption standard and not an occupation of the field standard – as applies to national banks, and apply to Federal thrifts the visitorial powers standards applicable to national banks;
- Eliminate ambiguity concerning the preemption standards in OCC regulations by removing language from OCC rules that provides that state laws that "obstruct, impair, or condition" a national bank's powers are preempted; and
- Revise the OCC's visitorial powers rule to conform the Supreme Court's Cuomodecision, recognizing the ability of state attorneys general to bring enforcement actions in court to enforce applicable laws against national banks as authorized by such laws.
In response to public comments received, the text of the preemption and visitorial powers amendments was revised to:
- Add language to clarify that, going forward, federal savings associations will be subject to the same preemption standards that apply to national banks.
- Clarify the definition of “visitorial powers” in § 7.4000(a)(2)(iv) to include direct investigations of national banks, such as through requests for documents or testimony directed to the bank to ascertain the bank’s compliance with law through mechanisms not otherwise authorized under the rule.
- This definition would not include collecting information from other sources, or from the bank through actions that do not constitute visitations, or as authorized under federal law.
- Modify a new paragraph, (b) § 7.4000, added in the proposed rulemaking which specifically provides that “[i]n accordance with the decision of the Supreme Court in Cuomo . . ., an action against a national bank in a court of appropriate jurisdiction brought by a state attorney general (or other chief law enforcement officer) to enforce an applicable law against a national bank and to seek relief as authorized by such law is not an exercise of visitorial powers under 12 U.S.C. 484.”
- The phrase “applicable law” was added in place of “non-preempted state law” in order to address concerns expressed by public commenters that the latter could be interpreted more narrowly than the former.
The preamble to the final rule expands the discussion of the preemption and visitorial powers provisions to address more thoroughly certain points raised in public comment letters received by the OCC. In particular, the preamble notes that the OCC has reconsidered its position concerning precedent that relied on the "obstructs, impairs, or conditions” standard. To the extent that an existing preemption precedent relies exclusively on the phrase “obstructs, impairs, or conditions” as the basis for a preemption determination, the preamble states that the validity of the precedent would need to be reexamined to ascertain whether the determination is consistent with the Barnett conflict preemption analysis.
The final rule also revises OCC rules in areas that are central to internal agency functions and operations immediately upon the transfer of supervisory jurisdiction for federal savings associations. These include amendments to the OCC’s assessment fee rule to include federal savings associations. Following a transition period, the final rule provides a single assessment schedule for both national banks and federal savings associations. To facilitate the transition of federal thrift supervision from the OTS to the OCC, the OCC will compute assessment fees under both the OCC and OTS schedules for assessments charged in September 2011 and March 2012. Federal savings associations will pay the lesser of the two fees. Beginning with assessments charged in September 2012, the OCC will assess institution fees based on a single fee schedule regardless of charter.
The rule also includes revisions to rules related to OCC organization, the availability and release of information under the Freedom of Information Act (FOIA), and post-employment restrictions for senior examiners.
As part of the integration of the OTS functions into the OCC, the OCC also plans to issue an Interim Final Rule, with a request for comments, that republishes those OTS regulations the OCC has the authority to promulgate and enforce as of the transfer date, renumbered and issued as new OCC rules, with nomenclature and other technical amendments to reflect OCC supervision of federal savings associations. The OCC will consider more comprehensive substantive amendments to these regulations, as appropriate, later this year.
The final rule will be published in the Federal Register tomorrow.
Related link
- Final Rule (PDF)
Friday, July 22, 2011
Thursday, July 21, 2011
Wednesday, July 20, 2011
Tuesday, July 19, 2011
Monday, July 18, 2011
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Saturday, July 16, 2011
Friday, July 15, 2011
Thursday, July 14, 2011
Wednesday, July 13, 2011
Tuesday, July 12, 2011
Generic Drugs: Their Use Saves Consumers Billions of Dollars, But Consumers Could Do Better If Doctors Cooperated
About 70% of all prescriptions for drugs are filled with generic drugs. The move to generic drugs has occurred for many reasons including a landmark 1984 federal law that encouraged their development. Another reason is that laws in many states require pharmacies to give consumers the generic version of a prescription drug whenever a generic version is available, even if the doctor prescribes the brand name. In the aggregate, these laws, pressure from insurers, and growing acceptance of generic drugs by many doctors, save consumers (and their public and private insurers) tens of billions of dollars every year.But there is a big exception in the state "generic substitution" laws: When doctors prescribe brand name drugs and demand that the pharmacist "dispense as written" (that is, when they write "DAW" on their prescription pads), the pharmacist generally must fill the prescription with the brand name drug. About 5% of all prescriptions are DAW, costing consumers lots of money.
How much money? Well, the difference in price between brand name and generic drugs can be very large. Here's one example from an informative article in today's Washington Post on DAW prescriptions:
Take . . . the popular anti-cholesterol drug Zocor. According to Drugs.com, a 90-pill bottle costs $459.98. But 90 pills of simvastatin, the generic version of Zocor, are only $83.97. Buy simvastatin at Wal-mart or Target, which offer special pricing programs, and the cost comes down to just $12.
Why do doctors insist on DAW? According to the Post article, because (1) some doctors wrongly believe that generic drugs are unsafe or ineffective; (2) some doctors frequently remember only the brand name not the generic name of the drug (which doesn't seem like a reason to use DAW); and (3) some doctors are influenced by brand name advertising.
As the Post explains, some states trying to curb DAW prescriptions:
In 2009, for example, Massachusetts began requiring doctors to explain in writing why they were insisting — via a DAW — on a brand-name medication as opposed to a generic. The results were dramatic. According to the Generic Pharmaceutical Association, the state’s Medicaid spending for drugs fell by $150 million within a year.
It will be interesting to see whether other states follow Massachusetts' lead.
Monday, July 11, 2011
Friday, July 08, 2011
Sobering Information on the Obesity Epidemic
Yesterday brought to my attention some distressing material on the obesity epidemic.
First, the Trust for America's Health and the Robert Wood Johnson Foundation issued a report entitled "F as in Fat: How Obesity Threatens America's Future 2011." The report reviews staggering increases in obesity rates in the United States. A person is considered obese if his or her body mass index (BMI) -- a calculation based on height/weight ratios -- is 30 or greater.Here is the beginning of the press release accompanying the report:
Adult obesity rates increased in 16 states in the past year and did not decline in any state. ... Twelve states now have obesity rates above 30 percent. Four years ago, only one state was above 30 percent.The obesity epidemic continues to be most dramatic in the South, which includes nine of the 10 states with the highest adult obesity rates. States in the Northeast and West tend to have lower rates. Mississippi maintained the highest adult obesity rate for the seventh year in a row, and Colorado has the lowest obesity rate and is the only state with a rate under 20 percent. This year, for the first time, the report examined how the obesity epidemic has grown over the past two decades. Twenty years ago, no state had an obesity rate above 15 percent. Today, more than two out of three states, 38 total, have obesity rates over 25 percent, and just one has a rate lower than 20 percent. Since 1995, when data was available for every state, obesity rates have doubled in seven states and increased by at least 90 percent in 10 others. Obesity rates have grown fastest in Oklahoma, Alabama, and Tennessee, and slowest in Washington, D.C., Colorado, and Connecticut.
As noted, the states with the highest obesity rates are overwhelmingly located in the South. But some Northern states fare poorly as well. For instance, Michigan is 10th, with an obesity rate of 30.5%. And get this: The highest state obesity rate in 1995 (Mississippi at 19.4%) is lower than the lowest state obesity rate today (Colorado at 19.8%).
The report also discusses the relationship between obesity and serious diseases, such as diabetes and high blood pressure:
Obesity contributes to a range of chronic diseases, including diabetes and hypertension. Of the 10 states with the highest rates of diabetes, eight are also in the top 10 for obesity; of the 10 states with the highest rates of hypertension, nine also rank in the top 10 for obesity. Between 1995 and 2010, obesity, diabetes, and hypertension also all rose significantly in almost every state and in Washington, D.C.
The Report goes on to address the particular challenges posed by massive increases in childhood obesity and discusses a wide array of current and potential government policies to curb obesity. Read the entire press release, the full report, and a Washington Post storyon the report.
The report's discussion of government policy targetting obesity brings me to a second topic: laws aimed at reducing obesity by requiring disclosure of the calorie content of restaurant food. Over the past decade, localities, such as New York City, Philadelphia, and Montgomery County, Maryland, began to require calorie disclosures at chain restaurants. And, beginning next year, FDA calorie disclosure regulations will apply nationwide. This blog has covered that issue in some depth and expressed optimism that menu labeling would cause people to eat more healthily.
But, according to this story in yesterday's Washington Post, calorie disclosures have made little or no difference, particularly to the people who are meant to benefit from them:
Evidence is mounting that calorie labels — promoted by some nutritionists and the restaurant industry to help stem the obesity crisis — do not steer most people to lower-calorie foods. Eating habits rarely change, according to several studies. Perversely, some diners see the labels yet consume more calories than usual. People who use the labels often don’t need to. (Meaning: They are thin.)
There is little data so far, and it is going to be difficult to isolate the effects of calorie disclosure on eating behavior from other effects that may push in the same or the opposite direction. But we have noted on several occasions -- go here, for instance -- that disclosure laws do not always achieve their intended goals. Calorie disclosure is one tool among many, and, as with the long fight against tobacco addiction, disclosures, warnings, and other forms of public education may take a long time and considerable retooling before they begin to work.
Thursday, July 07, 2011
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