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COVID-19: Federal Update (7/17)

Quick Takes

— CONGRESS BRACES FOR TWO WEEK LEGISLATIVE SPRINT. House and Senate lawmakers will return to action next week to begin a two-week legislative blitz to close out the month of July before leaving for the August district work period.

—GOP LIABILITY PROPOSAL UNDER WH REVIEW. The White House is reportedly reviewing a proposal from Senate Republicans that would limit the liability of health care workers, business owners, and employees from lawsuits pertaining to the COVID-19 outbreak. 

— FED EXPANDS MAIN STREET LENDING PROGRAM TO INCLUDE NONPROFITS. Nonprofit organizations such as educational institutions, hospitals, and social service entities will now be eligible for credit.

— CFPB PUBLISHES REPORT ON COVID-RELATED CONSUMER COMPLAINTS. The analysis reviews more than 8,000 complaints received from January through May that specifically pertain to the COVID-19 pandemic. 

Capitol Hill Update

— CONGRESS BRACES FOR TWO-WEEK LEGISLATIVE SPRINT. House and Senate lawmakers will return to action next week to begin a two-week legislative blitz to close out the month of July before leaving for the August district work period. Negotiations on the next COVID-19 relief package are expected to begin in earnest once Members return, as it is widely expected that Senate Republicans will introduce an opening offer proposal late next week. While lawmakers on both sides of the aisle have expressed willingness to get something done on the next relief package, it remains to be seen whether the parties can clinch a bipartisan agreement given the deep policy divides over the size and scope of the next COVID-19 bill. Meanwhile, each chamber will pick up consideration of their respective versions of the National Defense Authorization Act (NDAA) to kick off this two-week stretch.

— HOUSE READIES FIRST APPROPS 'MINIBUS.' In addition to the NDAA, House lawmakers have queued up consideration of the chamber's first "minibus" package for fiscal year (FY) 2021 — which includes Agriculture-FDA, State-Foreign Operations, Military Construction-VA, and Interior-Environment spending bills. The lower chamber is expected to continue its work on appropriations during the following week of Jul. 27 after the first package of bills clears the House next week. Also on the floor next week, Members are poised to take up the Senate-passed Great American Outdoors Act, as well as a pair of child-care related measures (H.R. 7027H.R. 7327). 

Washington Insider: What We're Reading

The U.S. labor-market recovery is losing momentum as a surge in coronavirus cases triggers heightened employer uncertainty and consumer caution. The labor-market slowdown is widespread across industries and states, showing the economic turmoil isn’t limited to states in the South and West that are seeing the greatest increases in illnesses. It also comes as Congress considers whether to extend $600 a week federal unemployment benefits that around 25 million workers are receiving through the end of July as part of a coronavirus relief package.

The $600 weekly boost in unemployment insurance payments is likely to expire before lawmakers reach a deal on the next coronavirus relief package, raising the stakes for negotiations and creating more uncertainty for people relying on the government aid. Because most states process payments on a weekly cycle ending on Saturdays or Sundays, states will stop paying out the extra $600 on July 25 or 26 unless Congress acts quickly. But negotiations between the House and Senate aren’t expected to begin in earnest until early next week — and the two parties remain far apart on the contours of an agreement.

President Donald Trump announced Wednesday that he is rolling back a foundational Nixon-era environmental law that he says stifles infrastructure projects, but that is credited with keeping big construction projects from fouling up the environment and ensuring there is public input on major projects. Trump was in Atlanta to announce changes to National Environmental Policy Act regulations for how and when authorities must conduct environmental reviews, making it easier to build highways, pipelines, chemical and solar plants and other projects.

A federal court late Wednesday struck down a Trump administration rule that weakened restrictions on methane gas releases from drilling on public land, restoring an Obama-era rule. In 2018, the Bureau of Land Management (BLM) rolled back parts of the prior rule that limited the release of the greenhouse gas. The change was expected to allow for more methane leaks in a process called flaring and add to air pollution. 

COVID-19: What We're Hearing

— 'CARES 2.0' STATE OF PLAY. Senate Republicans' opening offer on the next round of COVID-19 relief legislation could be unveiled as soon as next week as the upper chamber prepares to return from its July 4 district work period. Majority Leader Mitch McConnell (R-KY)'s proposal is expected to focus on health care, jobs, and liability protections. Reports suggest that the GOP's bill will also contain $50-$100 billion in education funding, and could either be attached with conditions or incentives for schools to develop concrete reopening plans in the fall. Lawmakers are mulling over several policy options for the next round of legislation, including:

  • Liability. The White House is reportedly reviewing a proposal from Senate Republicans that would limit the liabilities of health care workers, business owners, and employees from lawsuits pertaining to the COVID-19 outbreak. According to a summary that has been circulating around Capitol Hill, Leader McConnell's liability proposal would insulate stakeholders from lawsuits retroactive to Dec. 2019 through 2024, unless these entities have been proven to be grossly negligent or intentionally engaged in harmful behavior. For personal liability and medical cases, the plan would require clear-and-convincing-evidence burden of proof, and would also place a limit on damages while heightening pleading standards. It is also expected to provide defendants with the option of moving their case to federal court.

  • Leader McConnell has continuously emphasized that any future COVID-19 relief efforts must include these protections in order for the Senate to consider additional relief legislation. House Democratic leadership appears open to negotiating a deal on these protections, but have emphasized that a liability shield must not undermine the health and rights of workers, but indicated that the issue is open for further discussion and negotiation.

  • Health Care Priorities. One of the key areas of bipartisan agreement among the negotiating parties is the need to address existing and emerging health care needs as a result of the pandemic, as well as shoring up the nation's testing regime. These priorities are expected to be reflected in the Senate GOP's forthcoming proposal, and are also reflected in the House-passed HEROES Act.

  • Reports out of the Trump administration suggest that the White House is prioritizing action on surprise medical billing in the next round of relief legislation. It is also looking to address price transparency for pharmaceuticals, as well as an adjustment in the reimbursement rate for telemedicine.

  • Payroll Tax Cut. The Trump administration emphasized that the next COVID-19 relief bill must include a payroll tax cut in order for it to earn the president's signature. While this has been a priority for President Trump throughout the pandemic response efforts. the proposal has received a chilly reception from Members on both sides of the aisle and is not likely to be included in a final deal.

  • Unemployment Reform. Congressional Republicans have spearheaded efforts on reforming the enhanced unemployment benefits so that generous payments approved in the CARES Act don’t become an obstacle to rehiring workers. Democrats, on the other hand, have emphasized that the enhanced unemployment insurance benefits must be a part of the next round of relief legislation.

  • Senate Republicans have expressed openness to lowering the unemployment boost from $600 to the $200-$400 range. Another compromise option could be enhancing a tax credit that would give employers a tax break for keeping workers on the payroll.

  • Stimulus Payments. President Trump stated recently that he is open to another round of direct economic impact payments, saying that he wants “larger numbers than the Democrats” have offered. Leader McConnell has also expressed openness for another round of stimulus payments that would be targeted toward individuals making $40,000 a year or less.

  • PPP. The Paycheck Protection Program (PPP) application process has officially been reopened thanks to swift action by Congress. House and Senate lawmakers were able to clinch unanimous consent agreements on a bill that would reopen the application process for the roughly $134 billion remaining in the signature small business rescue program, pushing the application deadline from June 30 to August 18. lawmakers are already eyeing additional PPP reforms in the next round of COVID-19 relief legislation. 

  • Small Business Committee Chairman Marco Rubio (R-FL) is drafting additional PPP legislation that would create new programs to expand the use of the remaining funds within the program, including a $25 billion set-aside for businesses with fewer than 10 employees.

  • Ranking Member Ben Cardin (D-MD) and Sen. Jeanne Shaheen (D-NH) have introduced a bill that would extend the PPP application deadline by six months and authorize new lending for businesses with fewer than 100 employees.

  • Additionally, there has been a bipartisan push in Congress to expand PPP eligibility to 501(c)6 organizations and other currently ineligible nonprofits in the next round of COVID-19 relief legislation.

  • State and Local Governments. Funding for state and local governments is a key pillar of the Democrats' next stimulus bill. While there is bipartisan agreement that more needs to be done to help stymie economic hardships for these entities, allocating additional funding has become a divisive issue within the Republican conference.

  • It appears likely that some Senate Republicans — particularly those who are up for re-election — would coalesce behind a bipartisan proposal that would provide additional funding and flexibility to address needs at the state and local level.

Budget Reform. A bipartisan group of House lawmakers penned a letter to Speaker Nancy Pelosi (D-CA) and Minority Leader Kevin McCarthy (R-CA) calling for provisions that address the federal debt and trust funds for Medicare and Social Security to be included in the next round of COVID-19 relief legislation. 

COVID-19 Legislative & Regulatory Trackers


— FED EXPANDS MAIN STREET LENDING PROGRAM TO INCLUDE NONPROFITS. The Federal Reserve announced that it will expand its Main Street Lending Program to provide greater access to credit for nonprofit organizations such as educational institutions, hospitals, and social service organizations. 

— CFPB PUBLISHES REPORT ON COVID-RELATED CONSUMER COMPLAINTS. The Consumer Financial Protection Bureau (CFPB) published an analysis of the more than 8,000 complaints it received from January through May that specifically pertain to the COVID-19 pandemic. 


— FED EXTENDS PPP-RELATED RULE CHANGE. The Federal Reserve announced an extension of a rule change aimed at bolstering the effectiveness of the Small Business Administration's (SBA) Paycheck Protection Program (PPP). The extension will temporarily modify the Board's rules so that certain bank directors and shareholders can apply to their banks for PPP loans for their small businesses.

— CMS PUBLISHES OVERVIEW OF TELEHEALTH UTILIZATION. In a blog post in the Journal Health Affairs, CMS Administrator Verma provides an overview of CMS’ analysis of telehealth utilization among Medicare beneficiaries during the pandemic. 

— HHS CHANGES PROCESS FOR HOSPITALS TO REPORT COVID-19 DATA. The Department of Health and Human Services (HHS) announced changes to its process for collecting daily COVID-19-related data from hospitals, starting today. HHS plans to use this data to inform decisions at the federal level, such as allocation of supplies, treatments, and other resources.

— TRP SPECIAL REPORT: THE PROVIDER RELIEF FUND AND ITS DISTRIBUTIONS. On Jul. 10, HHS announced $4 billion in additional COVID-19 relief funding for providers that serve a high number of Medicaid patients and provide large amounts of uncompensated care, including to rural populations. Click here to read TRP's updated analysis on the provider relief fund and its distributions.

CMS EXTENDS COMPLIANCE DEADLINE FOR MEDICAID HCBS SETTINGS RULE. The Centers for Medicare & Medicaid Services (CMS) announced it was extending the deadline to March 17, 2023, for ensuring compliance with the Home and Community-Based Settings Regulation, in response to the COVID-19 pandemic.

— CMS ALLOCATES ADDITIONAL RESOURCES FOR NURSING HOMES. CMS announced plans to provide additional resources to nursing homes COVID-19 hotspots. Specifically, the agency plans to deploy Quality Improvement Organizations (QIOs) across the country to provide immediate assistance to nursing homes in the hotspot areas as identified by the White House Coronavirus Task Force. 

— HHS PLANS TO DISTRIBUTE RAPID POC TESTING EQUIPMENT TO NURSING HOMES. HHS announced a large-scale procurement of U.S. Food and Drug Administration (FDA) -authorized rapid point-of-care diagnostic test instruments and tests to be distributed to nursing homes in COVID-19 hotspot geographic areas.

— HHS, HRSA AWARD NEW FUNDING FOR HEALTH CENTERS. HHS and the Health Resources and Services Administration (HRSA) awarded $21 million to support health centers' COVID-19 response efforts.

  • This includes $17 million to support 78 Health Center Program look-alikes (LALs) with funding to expand capacity for COVID-19 testing.

— TREASURY UPDATES CORONAVIRUS RELIEF FUND FAQS. The Treasury Department updated its list of frequently asked questions on the state, local, and tribal Coronavirus Relief Fund.

— NIH LAUNCHES NEW COVID-19 CLINICAL TRIALS NETWORK. The National Institutes of Health (NIH) has launched a new clinical trials network to test COVID-19 vaccines and other prevention tools.

— HRSA POSTS FACT SHEET ON PROVIDER RELIEF FUND FOR MEDICAID AND CHIP PROVIDERS. HRSA has published a new fact sheet for Medicaid and CHIP providers on the Provider Relief Fund.

— SBA, TREASURY OFFICIALLY DISCLOSE PPP RECIPIENTS. SBA and Treasury Department have officially disclosed the names of more than 650,000 recipients of the PPP. Click here to access the database.

— TRUMP ADMINISTRATION ANNOUNCES NEW 'OPERATION WARP SPEED' INITIATIVES. HHS and Department of Defense announced two new investments into COVID-19 vaccines and treatments as a part of the Trump administration's "Operation Warp Speed" initiative. This includes a $450 million contract with Regeneron Pharmaceuticals to manufacture an investigational anti-viral antibody treatment, as well as a $1.6 billion deal with Novavax to ramp up production of a potential vaccine.

—TRP SPECIAL REPORT: THE VIABILITY OF DRUG PRICING REFORMS DURING THE COVID-19 PANDEMIC. TRP's newest Special Report examines recent legislation tackling drug pricing reform or price controls for COVID-19 therapies and vaccines, provides a state-of-play on the larger debate on the Hill and within the administration, and explores perspectives on ensuring the affordability of coronavirus-targeted products from the biopharmaceutical industry and health stakeholders.

— TRP SPECIAL REPORT: COVID-19 EMERGENCY DECLARATIONS AND HEALTH POLICY. TRP has published a Special Report describing how emergencies are declared, how they end, the health-related flexibilities that were enabled by the declarations, and what will happen when the emergencies expire. 

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