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COVID-19: Federal Update (7/9)


Quick Takes


— HOUSE APPROPRIATIONS COMMITTEE SET TO BEGIN CLEARING FY 2021 SPENDING BILLS. House lawmakers are poised to begin clearing fiscal year (FY) 2021 spending bills out of the full Appropriations Committee.

— CDC TO REVISE SCHOOL REOPENING GUIDANCE. The Centers for Disease Control and Prevention will release updated guidelines for reopening schools during the COVID-19 pandemic.

— DEFICIT RISES TO RECORD $2.7 TRILLION AMID PANDEMIC: CBO. The federal deficit in the first nine months of the fiscal year hit a record $2.7 trillion, nearly double the largest full-year deficit on record.


— 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 yesterday.


Capitol Hill Update


— HOUSE APPROPRIATIONS COMMITTEE SET TO BEGIN CLEARING FY 2021 SPENDING BILLS. House lawmakers are poised to begin clearing fiscal year (FY) 2021 spending bills out of the full Appropriations Committee, a move that will likely set up floor votes on the funding bills prior to the end of the month. After finishing the remaining subcommittee markups yesterday, House appropriators will meet today to consider the lower chamber's official 302(b) subcommittee allocations for FY 2021, as well as the State-Foreign Operations(report), Agriculture-FDA(report), and Military Construction-VA (report) measures. Additionally, the Committee will convene a markup of the spending bills for Interior-Environment (report) and Legislative Branch (report) bills tomorrow, and the Energy-Water Development and Labor-HHS-Educationbills on Monday.


Washington Insider: What We’re Reading


Roll Call: CDC to Revise School Reopening Guidance

The Centers for Disease Control and Prevention will release updated guidelines for reopening schools during the COVID-19 pandemic, Vice President Mike Pence announced Wednesday, after President Donald Trump said he disagreed with guidance from his own administration for doing so. In a series of tweets Wednesday morning, Trump threatened to cut off federal funding for schools if they do not open this fall and said he disagreed with the CDC’s “very tough & expensive guidelines.” Speaking alongside the White House Coronavirus Task Force, Pence said he’d spoken with Trump about the issue and the administration hoped to partner with school districts to work toward returning students to the classroom.


The Hill: Deficit Rises to Record $2.7 Trillion Amid Pandemic: CBO

The federal deficit in the first nine months of the fiscal year hit a record $2.7 trillion, nearly double the largest full-year deficit on record, according to Congressional Budget Office (CBO) estimates. In June alone, the deficit hit $863 billion, more than 107 times the $8 billion deficit recorded in June of last year. The deficit is on track to exceed $3.8 trillion, shattering the $1.4 trillion record set in 2009 as the global financial crisis led to the Great Recession.

The Wall Street Journal: Biden Looks to Curb Covid-19 Economic Damage With ‘Buy American’ Plan ($)

Former Vice President Joe Biden is expected Thursday to outline a plan that his campaign says is aimed at reviving the U.S. economy with an America-centric approach to job creation and manufacturing, issuing a direct challenge to President Trump as they compete for working-class voters less than four months before the presidential election. Mr. Biden is poised to unveil his agenda while campaigning in Dunmore, Pa., where the presumptive Democratic presidential nominee will tour a metalworks plant before making his economic pitch to an American public still reeling from the coronavirus pandemic.

Associated Press: Biden-Sanders Task Forces Unveil Joint Goals for Party Unity

Political task forces Joe Biden formed with onetime rival Bernie Sanders to solidify support among the Democratic Party’s progressive wing recommended Wednesday that the former vice president embrace major proposals to combat climate change and institutional racism while expanding health care coverage and rebuilding a coronavirus-ravaged economy. But they stopped short of urging Biden’s full endorsement of policies that could prove too divisive for some swing voters in November, like universal health coverage under “Medicare for All” or the sweeping Green New Deal environmental plan.


COVID-19: What We’re Hearing


— 'CARES 2.0' STATE OF PLAY. Senate Majority Leader Mitch McConnell (R-KY) provided more details on the GOP priorities for the next round of COVID-19 relief legislation this week in a sign that another bill could be on the horizon toward the end of this month. Leader McConnell stated that he will be unveiling legislation in the forthcoming weeks that prioritizes health care, jobs, reopening schools and universities, and liability protections. A timeline for action on the forthcoming GOP legislation is expected to take place between Jul. 20 to Aug. 8, but it remains to be seen whether Senate Republicans, House Democrats, and the Trump administration can come to terms on an agreement. Lawmakers are mulling over several policy options for the next round of legislation, including:

  • Liability. Leader McConnell and Sen. John Cornyn (R-TX) are working on legislation that would limit the liabilities of health care workers, business owners, and employees from lawsuits pertaining to the COVID-19 outbreak. Leader McConnell stated that the GOP's liability provision would insulate stakeholders from lawsuits retroactive to Dec. 2019 through 2024, unless these entities are "grossly negligent or intentionally engaged in harmful behavior. He 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 liability protections. House Majority Leader Steny Hoyer (D-MD) emphasized that these protections must not undermine the health and rights of workers, but indicated that the issue is open for further discussion and negotiation.

  • Health Care Priorities. 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.

  • During the CARES Act negotiations, Chairman Frank Pallone (D-NJ) and Senate Health, Education, Labor, and Pensions (HELP) Chairman Lamar Alexander (R-TN) were actively trying to tack their surprise billing legislation onto the package. 

  • Stimulus Payments. In a recent interview, President Trump expressed openness 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 last week. House and Senate lawmakers were able to clinch unanimous consent agreements on a bill that 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. 

  • Unemployment Reform. Senate Republicans are spearheading efforts on reforming the enhanced unemployment benefits so that generous payments approved in the CARES Act don’t become an obstacle to rehiring workers.

  • A key option on the table includes enhancing a tax credit that would give employers a tax break for keeping workers on the payroll.

  • 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...

— 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 yesterday.

— 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.


RECENT DEVELOPMENTS…

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


— SBA, TREASURY OFFICIALLY DISCLOSE PPP RECIPIENTS. The Small Business Administration (SBA) and Treasury Department have officially disclosed the names of more than 650,000 recipients of the Paycheck Protection Program (PPP). Clickhere to access the database.


— TRUMP ADMINISTRATION ANNOUNCES NEW 'OPERATION WARP SPEED' INITIATIVES. The Department of Health and Human Services (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.


— FDA ISSUES NEW EMERGENCY USE AUTHORIZATION FOR COMBINED COVID-19 DIAGNOSTIC TEST. The Food and Drug Administration (FDA) issued an emergency use authorization for a diagnostic test that can detect COVID-19 and and multiple strains of influenza.


— FDIC, FEDERAL RESERVE TO REQUIRE COVID-RELATED ADDS TO BANK LIVING WILLS. The Federal Deposit Insurance Corporation (FDIC) and Federal Reserve announced new requirements for large financial institutions to provide details on how they’ve incorporated lessons from the COVID-19 pandemic into their plan for unwinding in the event of bankruptcy.


— OMB PUBLISHES SPRING UNIFIED REGULATORY AGENDA FOLLOWING PANDEMIC DELAY. The Office of Management and Budget (OMB) released its Spring 2020 Unified Agenda of Regulatory and Deregulatory Actions (Unified Agenda) (OMB Page, HHS Agenda) this week following a lengthy delay due to the COVID-19 pandemic. Click here to read TRP's analysis on forthcoming rules from the Department of Health and Human Services (HHS). 


— FDA RELEASES GUIDANCE ON COVID-19 VACCINE AUTHORIZATIONS.The Food and Drug Administration (FDA) issued new guidance describing its expectations for potential COVID-19 vaccines that would be necessary to meet to receive approval. The agency describes acceptable primary and secondary endpoints for clinical trials, encourages standardization across clinical trials, and sets 50 percent efficacy as a primary endpoint. Efficacy may mean either preventing infection or preventing symptoms.

  • In addition, FDA raises the possibility of using so-called “challenge trials,” or deliberately exposing human subjects to infection, if it is not possible to demonstrate effectiveness through clinical disease endpoint efficacy studies. This guidance comes as stakeholders raise concerns about whether the public will trust a vaccine that has been rapidly developed to combat COVID-19.


CMS UPDATES MEDICAID FAQS. The Centers for Medicare and Medicaid Services (CMS) published a document addressing COVID-related questions from states and Medicaid stakeholders. The new frequently asked questions cover a broad range of topics, including financing changes and rate adjustments impacting providers, the optional COVID-19 testing group, and coverage of COVID-19 drugs and services among others. 


— 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.


— FED ISSUES NEW TERM SHEET FOR PMCCF. The Federal Reserve issued a new term sheet outlining pricing information for the Primary Market Corporate Credit Facility


— HHS SECURES NEW SUPPLY OF KEY COVID-19 TREATMENT. HHS announced an agreement to secure more than 500,000 doses of the antiviral remdesivir for U.S. hospitals from Gilead Sciences through September.

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