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Policy vs. Guidance

Defining the Difference

To:Heads of Contracting Activity
From:Angela Billups, Ph.D.
Senior Procurement Executive
Subject:Policy versus Guidance: Defining the Difference Between the Terms and Establishing the Way Forward at HHS
Effective Date:Immediately

Purpose

The purpose of this memorandum is to define the words “policy” and “guidance” and draw a clear line of distinction regarding the way in which these two terms will be used by the Department when issuing documentation requiring adherence by the acquisition workforce.  In addition, the order of precedence between executive orders, federal statutes, the Federal Acquisition Regulation (FAR) and the Health and Human Services Acquisition Regulation (HHSAR) is set forth in this memorandum with the intent to ensure the acquisition community has a clear understanding of how to properly apply the provisions of the aforementioned resources during the acquisition process. Lastly, this memo establishes the Department’s plan for the way forward by further detailing the steps that will be taken to revise the way in which policy and guidance is issued at HHS.

Background Information

Historically, policy has been issued via Acquisition Policy Memoranda (APM) and the HHSAR.  Similarly, guidance and instructions have been incorporated in APMs and the provisions of the HHSAR as well. There has not been a clear distinction between policy and guidance, nor has there been differentiation between where such information can be found.  This has resulted in the acquisition workforce’s high dependency on APMs; excess information within the HHSAR that is not considered policy and/or is simply a restatement of what is already prescribed in the FAR; and the acquisition community’s general migration away from ensuring that they reference statutory requirements, the FAR, and the HHSAR collectively when making acquisition decisions.

Defining Policy

Policy is defined as the general rules and regulations established by the Department with the purpose of governing the acquisition community during all stages of the procurement process from inception to contract closeout.  Such principles are established to ensure proper execution of contracting procedures, as well as to further reinforce and require compliance to acquisition related statutes and federal acquisition regulations.  HHS Acquisition Policy will be issued by the Division of Acquisition, Office of Acquisition Policy under the auspices of the Associate Deputy Assistant Secretary for Acquisition, Senior Procurement Executive

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Defining Guidance

Guidance is defined as useful information provided to assist the acquisition workforce in being compliant with agency policies, federal statutes, and federal acquisition regulation provisions. It can offer direction and aid in the form of guides, templates, instructions and applicable examples for consideration. It can further offer recommendations regarding acquisition related decisions and courses of action.

Order of Precedence

HHS shall use the following order of precedence when referencing executive orders, federal statutes, the FAR and the HHSAR during the acquisition process:

  1. a.) Federal Statutory Authorizations and Requirements – There are acquisition laws put in place by Congress to impose specific authorizations and requirements which regulate federal acquisition transactions. These statutes can be found in the United States Code (U.S.C) and the Code of Federal Regulations (CFR). Agencies can exercise an authority permitted by statute provided that such authority has been granted specifically to that agency and/or all government agencies.  Statutory requirements are mandatory and must be adhered to when applicable.

    b.) Executive Order – The U.S. President may issue an executive order which impacts government acquisition.  Executive orders have the full force of law when the President issues them under a statute or as an exercise of his inherent constitutional powers.  HHS acquisition offices must ensure compliance with all executive orders that are applicable to agency acquisitions.
  2. FAR – This regulation is third in the order of precedence for managing HHS acquisition programs following statutory requirements. If there is any conflicting guidance pertaining to contracting and an applicable statute does not exist, the Federal Acquisition Regulation will take precedence over all other regulation and HHS guidance except as otherwise provided by a deviation under FAR subpart 1.4 “Authorized Deviation”.
  3. HHSAR – Each government agency may issue an agency acquisition supplement to the FAR, but these supplements may not conflict with or supersede relevant FAR provisions, except as provided by an authorized deviation. Therefore, the HHSAR is an agency specific supplement to the FAR and is fourth in the order of precedence for HHS acquisition efforts.  The contents of this supplement can be more restrictive than the FAR but can never be less restrictive, except as provided by an authorized deviation. Therefore, in the absence of an authorized deviation, this regulatory resource cannot authorize allowances expressly prohibited by the FAR.  Furthermore, the HHSAR should never be referenced in isolation.  Acquisition professionals must always reference the FAR first and then proceed to the HHSAR to determine if HHS has established supplemental restrictions and/or requirements.

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Establishing the Way Forward

  1. Policy - Moving forward, all acquisition policy that is not otherwise dictated by statute or found in the FAR will be prescribed in the HHSAR.  The HHSAR rewrite is currently underway and during the revision process, all restatements of FAR provisions and guidance and instructions will be removed. In addition, APMs will be phased out by rescinding and no longer used.  Please note that, during the phasing out process, interim memoranda may be issued.  The HHS acquisition community will be expected to use the aforementioned order of precedence when implementing executive orders, federal statutes, the FAR and the HHSAR. 
  2. Guidance – Guidebooks, Handbook, Standard Operating Procedures (SOPs) Desk Books, and templates have been created and will continue to be created to offer the acquisition workforce useful information, direction and instructions applicable to specific acquisition requirements.  The Department is also in the process of developing a Procedures, Guidance and Information (PGI) resource which will supplement the HHSAR.  The PGI will provide relevant instructions and guidance necessary to comply with the policies prescribed in the HHSAR.  Such guidance will be made available to the HHS acquisition workforce on the OGAPA/Division of Acquisition website located at http://www.hhs.gov/asfr/ogapa/acquisition/index.html
  3. Acquisition Alerts – The Department understands that, although mandatory and critical, this new approach to the issuance of policy and guidance is a cultural change for HHS.  In order to aid in this transition, the Department will send out Acquisition Alerts to the HCAs as well as post them on the OGAPA/Division of Acquisition Website.  The purpose of these alerts will be to provide notice when:
    1. New guidance and/or policy is pending implementation to inform OPDIVs/STAFFDIVs;
    2. New guidance has been issued and made available on the website;
    3. Existing guidance has been revised or replaced and made available on the website;
    4. APMs have been rescinded and/or in the phase out process;
    5. Interim memorandums are issued;
    6. Revisions are made to the HHSAR and made available on the website; and
    7. The PGI has been developed and made available on the website.

HCA Responsibilities

In furtherance of this Departmental effort, HCAs are required to develop procedures to ensure their acquisition community is aware of all policy and guidance distributed by the Department and immediately conforms in order to be in compliance.

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