concurring in part and dissenting in part:
This court upholds today three of five regulations that the Health Care Financing Administration (“HCFA”) promulgated pursuant to the “Medicare as Secondary Payer” (“MSP”) statute, 42 U.S.C. § 1395y(b). I dissent from that portion of the majority opinion holding HCFA’s third party administrator regulation unreasonable. While I concur in the judgment of the court regarding the impermissible retroactivity of one of the challenged regulations, the reasoning on which I base that judgment differs from that of the majority.
A. 12 C.F.R. § 111.21(e): Third Party Administrator Liability
The Medicare as Secondary Payer statute authorizes HCFA to recover conditional Medicare payments from “any entity which is required or responsible to pay ... under a primary plan” for services rendered. 42 U.S.C. § 1395y(b)(2)(B)(ii). HCFA construes this statutory provision to include third party administrators (“TPAs”), companies that administer the payment of health care benefits without assuming financial liability for claims filed. 42 C.F.R. § 411.24(e). The majority holds this regulation to be unreasonable; I would uphold the regulation under the deferential standards of Chevron U.S.A Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984).
Due to the “operational realities” of health care payment systems, HCFA often does not know and cannot readily ascertain whether a given insurance company is acting as a conventional insurer or a third party administrator with respect to any given claim. To expedite its recovery of conditional Medicare payments, HCFA includes TPAs as entities “required or responsible to pay” within the meaning of the MSP statute. HCFA’s approach is consistent with both the statute’s plain language and its underlying purpose. TPAs are literally “required” and “responsible” to pay claims filed under the primary health plans that they administer. Treating TPAs as entities “responsible to pay” facilitates governmental recovery of “conditional” Medicare payments, an underlying purpose of the MSP statute.
The majority rejects HCFA’s statutory interpretation, explaining that a literal reading of the relevant statutory language proves too much. The majority points out that banks, on which group health plans draw their benefits checks, are also literally “required” and “responsible” to pay for medical services covered by the plans, yet it would be unreasonable to construe the relevant statutory language as extending to them. In my view, the majority glosses over salient differences be*428tween banks and third party administrators in the health care payment context that make it reasonable to regard TPAs, but not banks, as entities “required or responsible to pay5’ within the meaning of the MSP statute.
When a health plan draws a benefits check, it effectively orders its bank to pay a specified sum to a designated payee. It delegates no authority to the bank to make discretionary judgments concerning the payment or processing of subscribers’ health care claims. TPAs, by contrast, frequently make such judgments on behalf of plans they administer. As sophisticated, repeat players in the health insurance field, TPAs, unlike banks, are often better situated than health plan providers to oversee primary plan compliance with MSP statutory requirements. HCFA cannot readily distinguish those TPAs that exercise such oversight from those whose duties are purely clerical.
HCFA’s Third Party Administrator Liability regulation is both consistent with the MSP statute’s plain language and reasonably calculated to effectuate the statute’s underlying purpose. Under Chevron this is sufficient. Notwithstanding the majority’s indications to the contrary, determinations of reasonableness do not turn on whether a regulation is “necessary to accomplish Congress’s goals.” I would uphold the regulation.
B. Retroactivity
Although I concur in the majority’s judgment regarding the retroactivity of HCFA’s “double payment” regulation, 42 C.F.R. § 411.24(i), I write separately because I neither subscribe to the majority’s exposition of Sentara-Hampton General Hosp. v. Sullivan, 980 F.2d 749 (D.C.Cir.1992) (per cu-riam) nor distinguish agency from Article III adjudications in analyzing the challenged regulations’ retroactivity.
Retroactive rulemaking lies beyond the Secretary’s power. Bowen v. Georgetown University Hospital, 488 U.S. 204, 109 S.Ct. 468, 102 L.Ed.2d 493 (1988). I agree with the majority that the gravamen of retroactivity is a rule’s practical impact, not its “interpretive” or “legislative” label. A rule is retroactive if it “takes away or impairs vested rights acquired under existing law, or creates a new obligation, imposes a new duty, or attaches a new disability in respect to transactions or considerations already past.” Association of Accredited Cosmetology Schools v. Alexander, 979 F.2d 859, 864 (D.C.Cir.1992) (internal citations omitted).
Applying this standard to the facts of this case, HCFA’s “double payment” regulation, 42 C.F.R. § 411.24(i), is impermissibly retroactive with respect to transactions that occurred prior to November 13,1993, the regulation’s effective date. Prior to adopting its “double payment” regulation, HCFA did not interpret “responsible to pay” to include insurers and self-insured employers who had already paid for the item or service rendered. By construing those “responsible to pay” to include these entities, HCFA’s “double payment” regulation marks a sea change in governmental policy. Because the regulation imposes new obligations, duties, and liabilities on these entities, I concur in the majority’s judgment that 42 C.F.R. § 411.24(i) cannot apply to payments made before its effective date.
The majority reads Sentara-Hampton General Hosp. v. Sullivan, 980 F.2d 749 (D.C.Cir.1992) (per curiam) to suggest that our holding would be different if HCFA had applied 42 C.F.R. § 411.24(i) in an internal agency adjudication. I read Sentara-Hamp-ton differently. The regulations at issue in that case merely clarified and reaffirmed the reimbursement standard to which HCFA already subjected regulated parties before the Hospital borrowed the funds for which it sought reimbursement. Unlike the regulations at issue in Sentara-Hampton, HCFA’s double payment regulation does more than simply clarify an underlying statute or preexisting policy; it effects a substantive change in the duties and liabilities of regulated parties.
HCFA’s “third party administrator” regulation, 42 C.F.R. § 411.24(e), also effects a substantive change in the obligations, duties, and liabilities to which TPAs are subject. By the terms of their contracts, TPAs typically do not underwrite the health plans that they administer; they simply process claims filed under health plans for which another entity assumes financial responsibility. Before *429HCFA promulgated § 411.24(e) in 1989, it had interpreted the statutory reference to those “responsible to pay” to include only entities that assumed financial responsibility for claims filed. By holding third party administrators liable for repayment of conditional Medicare payments, § 411.24(e) imposes new obligations, duties, and liabilities on TP As. Consequently, the government could not validly apply 42 C.F.R. § 411.24(e) to claims and payments made prior to its effective date.
C. Conclusion
I concur both in the court’s analysis of HCFA’s “double payment,” “Medigap extension,” and “mandatory notice” regulations, 42 C.F.R. §§ 411.24®, 411.32(a)(1), and 411.-25(a), as consistent with the Medicare as Secondary Payer statute and its analysis of HCFA’s “claims filing override” regulation, 42 C.F.R. § 411.24(f), as inconsistent with that statute. I too think that HCFA’s “double payment” regulation is impermissibly retroactive but so conclude on a different basis than the majority. As to the court’s holding that HCFA’s “third party administrator” regulation, 42 C.F.R. § 411.24(e), is inconsistent with the Medicare as Secondary Payer statute, I dissent. If the applicability of that regulation were limited to claims or transactions that occurred after the regulation’s effective date, I would find the regulation valid.