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COVID-19: Federal Update (7/21)

Updated: Jul 23

Quick Takes

— OFFICIALS RAMP UP COVID-19 NEGOTIATIONS AS SENATE GOP PROPOSAL LOOMS. Officials have begun negotiations on another round of COVID-19 relief legislation as Senate Republicans ready their opening offer proposal for introduction later in the week.

— HOUSE QUEUES UP SECOND SEVEN-BILL APPROPRIATIONS PACKAGE. Members on the House Appropriations Committee announced a second "minibus" for consideration next week.

— WHITE HOUSE WORKS TO SELL GOP SENATORS ON PAYROLL-TAX CUT. Republicans are seeking to bridge internal divisions on a payroll-tax cut and other issues in the next coronavirus-relief package.


— WAYS AND MEANS REPUBLICANS CIRCULATE TELEHEALTH DISCUSSION DRAFT. Click here to read TRP's analysis of this legislation.


Capitol Hill Update

— OFFICIALS RAMP UP COVID-19 NEGOTIATIONS AS SENATE GOP PROPOSAL LOOMS.

Officials have begun negotiations on another round of COVID-19 relief legislation as Senate Republicans ready their opening offer proposal for introduction later in the week. Details on Majority Leader Mitch McConnell's (R-KY) forthcoming proposal could trickle out as soon as today, as he is expected to provide details to Senators at the Senate GOP's weekly caucus lunch. On the Senate floor, Leader McConnell stated moments ago that the bill will include $105 billion toward education, another round of direct economic impact payments, and "targeted" funding for the Small Business Administration's (SBA) Paycheck Protection Program (PPP). Meanwhile, Speaker Nancy Pelosi (D-CA) is scheduled to meet with White House Chief of Staff Mark Meadows, Treasury Secretary Steven Mnuchin, and Senate Minority Leader Chuck Schumer (D-NY) today to discuss the next COVID-19 bill. The Speaker has expressed a desire to hammer out an agreement by the end of next week, yet the two sides will need to navigate debates on several hot-button issue areas before a final deal is in place.


— HOUSE QUEUES UP SECOND SEVEN-BILL APPROPRIATIONS PACKAGE. Members on the House Appropriations Committee announced a second "minibus" for consideration next week as the House looks to wrap up its fiscal year (FY) 2021 appropriations process prior to the end of the month. The seven-bill package will include the FY 2021 spending bills for Defense, Commerce-Justice-Science, Energy and Water Development, Financial Service and General Government, Homeland Security, Labor-HHS-Education, and Transportation-Housing and Urban Development. House lawmakers will take up the chamber's first minibus package —which consists of the Agriculture-FDA, State-Foreign Operations, Military Construction-VA, and Interior-Environment spending bills — following consideration of the lower chamber's National Defense Authorization Act (NDAA).


— CONGRESS RESUMES NDAA DEBATE. House and Senate lawmakers will each resume consideration of their respective versions of the NDAA when the chambers gavel in today. Both chambers are expected to pass the annual defense spending bill prior to the end of the week. They will then move onto  Conference Committee to iron out a final deal, where lawmakers will need to resolve several key differences related to changing the name of military bases named after Confederate leaders, the transfer of excess military equipment to law enforcement agencies, and limiting Executive Branch war power authority, among other things.


Washington Insider: What We're Reading

The Wall Street Journal: White House Works to Sell GOP Senators on Payroll-Tax Cut ($)

Republicans are seeking to bridge internal divisions on a payroll-tax cut and other issues in the next coronavirus-relief package, with top Trump administration officials set to meet with Senate Republicans before beginning talks with Democrats later in the day. Senate Majority Leader Mitch McConnell (R., Ky.) plans to roll out a unified GOP proposal this week that is expected to cost about $1 trillion. Lawmakers are racing to reach an agreement on the legislation within weeks, facing the expiration of enhanced unemployment benefits on July 31 and the beginning of a scheduled break on Aug. 7.

Associated Press: Biden Outlines Priorities for Next Pandemic Relief Package

Biden’s statement outlines four main priorities for the congressional package, most of which put him directly at odds with the president. Biden calls on Congress to authorize all necessary funding for public health tools to fight the pandemic, including testing and tracing the virus’ spread, and personal protective equipment. Biden also urges Congress to reject any proposal to cut taxes for wealthy Americans, and to ensure aid dollars go to middle- and lower-class Americans and small businesses. And he says that Congress should mandate that any loans provided in the next package include a commitment that businesses use the funds to hire or protect American workers.


Roll Call: House Proposes Billions of Dollars for Technology Throughout Government

In recent weeks, House appropriators have approved hundreds of billions of dollars in government funding for fiscal 2021, culminating in the Appropriations Committee’s July 15 approval of legislation that would provide nearly $51 billion for the Homeland Security Department. With all 12 of the annual appropriations bills now approved by the committee, Congress is primed to spend heavily on a wide range of technologies. Appropriators set aside funds for cybersecurity on the eve of this November’s elections, rural broadband for unconnected and hard-to-reach Americans, STEM education for the country’s youth, and research into quantum computing and artificial intelligence.

The Hill: 20 States Sue EPA Over Weakened Justification for Power Plant Regulation

A coalition of 20 states, several cities and a county are suing the Environmental Protection Agency (EPA) over a regulation that undermines the justification for certain clean air standards.  The states sued over changes to the Mercury and Air Toxics Standards (MATS) rule, which regulates pollution from power plants. In a statement, they particularly took aim at the EPA’s determination that it is not “appropriate and necessary” to regulate the emissions of mercury and other pollutants from power plants. 


COVID-19: What We're Hearing

— 'CARES 2.0' STATE OF PLAY. Lawmakers are mulling over several policy options for the next round of legislation, including:

Liability. In a draft summary of the liability section obtained by TRP, the Senate GOP's proposal would insulate health care, education, government, and business entities from lawsuits retroactive to December 2019 through 2024 unless there is proof of "gross negligence and intentional misconduct."

  • For personal liability and medical cases, the plan would require a "clear-and-convincing-evidence burden of proof," would place a cap threshold on damages, and would heighten pleading standards. It would also limit liability for new products, such as types of PPE, if they meet established Food and Drug Administration (FDA) standards.

  • While these policies are subject to future negotiation and change, 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.

  • Education. 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.

  • 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. However, the administration has reportedly pushed back on additional funding for testing, tracing, and Centers for Disease Control and Prevention (CDC).

  • 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. However, GOP lawmakers have expressed openness in including some sort of payroll tax provision in light of the President's demands

  • 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


NEW TODAY...

— WAYS AND MEANS REPUBLICANS CIRCULATE TELEHEALTH DISCUSSION DRAFT. The Republicans of the House Ways & Means Committee issued a discussion draft of a bill to make permanent several of the temporary telehealth flexibilities implemented in response to the COVID-19 pandemic. Click here to read TRP's analysis of this legislation.

— HHS OCR ISSUES GUIDANCE ON CIVIL RIGHTS PROTECTIONS DURING COVID-19. The Department of Health And Human Services (HHS) Office of Civil Rights (OCR) issued guidance to ensure that recipients of federal financial assistance understand that they must comply with applicable federal civil rights laws and regulations that prohibit discrimination on the basis of race, color, and national origin in HHS-funded programs during the COVID-19 pandemic.

RECENT DEVELOPMENTS...

— HHS ANNOUNCES DISTRIBUTION OF $10B FOR HIGHLY IMPACTED HOSPITALS. On Friday, HHS announced that it would distribute $10B to hospitals in COVID-19 hotspots beginning this week. Click here to read TRP's updated provider relief fund memo.

  • This distribution, which was first announced June 8, is based on data that HHS collected from hospitals in June detailing COVID-19 admissions through June 10. In addition, the agency extended the deadline for Medicaid and CHIP providers to apply for relief funds from June 20 to August 3. 

— FDA APPROVES FIRST GROUP COVID-19 TEST. The Food and Drug Administration (FDA) issued an emergency use authorization for pooled COVID-19 testing. The Quest Diagnostic test is the first COVID-19 diagnostic test to be authorized for use with pooled samples.

— FED EXPANDS MAIN STREET LENDING PROGRAM TO INCLUDE NONPROFITS. The Federal Reserve announced that it will expend 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.

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.

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