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COVID-19: Federal Update (8/26)


Quick Takes

— CONGRESS SET TO RECONVENE IN SEPTEMBER. Both chambers have adjourned for the August district work period, and are not expected to convene for legislative business until next month.

— CITIES, STATES FEAR THEY MAY LOSE CRITICAL FEMA DOLLARS FOR CORONAVIRUS RESPONSE. In calls throughout August, FEMA signaled that it may soon seek to rethink the criteria by which it doles out those dollars.

2020 GOP CONVENTION ENTERS DAY THREE. Click here for details.

— HHS EXTENDS PROVIDER RELIEF FUND APPLICATION DEADLINE.  The new deadline to apply for funding through the CARES Act Provider Relief Fund is Sunday, Sept. 13.


Washington Insider: What We're Hearing

— SENATE GOP DRAFTS 'SKINNY' PANDEMIC RELIEF BILL. Republicans have drafted a slimmed-down version of their HEALS Act legislation that would address an array of COVID-19 priorities. Provisions in the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act pertain to testing, treatment, vaccines, the postal service, small business relief, education, unemployment insurance, and liability protections. For more on the Senate GOP's draft bill, click here to read TRP's analysis.

PANDEMIC EXECUTIVE ORDERS. With negotiations on the next round of COVID-19 relief legislation at a standstill, President Donald Trump issued a series of executive orders on pandemic-related priorities. The orders seek to restore the enhanced federal unemployment benefits at a rate lower than the CARES Act allocation, defer payroll taxes until early 2021, renew the moratorium on evictions, and continue deferring student loan payments and accrued interest under the CARES Act Statute. The executive actions do not touch on any health-specific priorities such as testing and treatment, nor does it address liability-related issues — leaving employers at-risk of litigation until a compromise deal is hammered out.

Details on the orders include: 

  • Unemployment Insurance. This order seeks to extend the pandemic unemployment assistance (PUA) established by the CARES Act, lowering the weekly bonus from $600 to $400. The administration calls on states to front 25 percent of the cost — equivalent to $100 toward the weekly benefit — with the federal government covering the remaining 75 percent. To fund the revamped PUA, the White House outlined hundreds of billions in federal funding that the administration plans to “reprogram” in a manner similar to the way it has diverted Pentagon funding for wall construction on the U.S.-Mexico border. The president says he will tap into roughly $80 billion in unallocated money from the CARES Act State, Local, and Tribal Coronavirus Relief Fund, as well as more than $40 billion from the Federal Emergency Management’s (FEMA) Disaster Relief Fund, to fund these efforts.


  • Payroll Tax. This order directs the Treasury Department to allow employers to defer payment of employee-side Social Security payroll taxes through the end of 2020 for employees earning less than about $100,000 annually. While the text of the EO states that the intended deferral period would start Sept. 1, President Trump suggested that it could be retroactive to Aug. 1, saying that he hopes to forgive the deferred payroll taxes and make permanent payroll tax cuts if he is reelected in November. While the tax code does give the Treasury secretary authority to delay tax filing and collection amid presidentially-declared disasters, it remains to be seen whether employers will stop withholding payroll taxes given the risk of future liability. Critics of this particular order have also expressed concerns about the impact this action could have on both the short and long-term solvency of the Social Security and Medicare trust funds.

  • Housing. This EO outlines potential policy actions that federal agencies could take to address housing evictions during the balance of the pandemic, but does not offer an explicit pause on evictions. Specifically, the order instructs agencies to: (1) consider whether halting evictions will help stem the spread of COVID-19 across state lines; (2) identify available funds available to provide temporary financial assistance to renters and homeowners; (3) promote the ability of renters and homeowners to avoid eviction or foreclosure by encouraging and providing assistance to public housing authorities, affordable housing owners, landlords, and recipients of Federal grant funds in minimizing evictions and foreclosures; and (4) review all existing authorities and resources that may be used to prevent evictions and foreclosures for renters and homeowners. Congressional Democrats reportedly agree that the president does have the authority to address housing evictions via executive order, but are unlikely to be satisfied with what they would consider to be the administration’s watered-down approach in this executive action.

  • Student Loans. This order directs the Department of Education to take the necessary steps to continue the CARES Act policy that temporarily pauses payments and waives interest on student loans held by the Department until Dec. 31. The EO does not, however, specifically reference student loan debt collection or counting non-payments toward public service loan forgiveness, both of which were included in the CARES Act. Additionally, the EO does not offer coverage for federal student loan borrowers whose debt is held by private lenders or their colleges — a priority that Congressional Democrats have sought in the COVID-19 relief talks.

— HEALS Act. Senate Republicans officially introduced their opening offer proposal for the next round of COVID-19 relief legislation following days of intraparty negotiations between GOP Senators and White House officials. The legislative package was officially released as multiple pieces of legislation, with six total sections:

Click here to view TRP's side-by-side of the Senate GOP HEALS Act and the House Democratic HEROES Act.

Washington Insider: What We're Reading

The Washington Post: Cities, States Fear They May Lose Critical FEMA Dollars for Coronavirus Response

City and state leaders expressed fears Tuesday that the Trump administration may cease reimbursing some of their purchases of masks, gloves and other personal protective equipment, a move they said could tear new holes in their budgets while threatening public health. The trouble stems from the Federal Emergency Management Agency, which typically provides funds for disaster relief and has played a central role in the coronavirus pandemic. In calls throughout August, FEMA signaled that it may soon seek to rethink the criteria by which it doles out those dollars, troubling local governments, which say they are desperate for easy-to-access federal cash as the contagion continues to spread.

Reuters: White House Says Trump Could Act Unilaterally to Avoid U.S. Airline Layoffs

President Donald Trump could take executive action to avoid massive layoffs at U.S. airlines, while an impasse on a new coronavirus stimulus package continues in Congress, White House Chief of Staff Mark Meadows said on Wednesday. “We’re looking at other executive actions,” Meadows said in an online interview with Politico. “If Congress is not going to work, this president is going to get to work and solve some problems. So hopefully, we can help out the airlines and keep some of those employees from being furloughed.”


The Hill: Senate Democrats Map Out Climate Change Strategy

Senate Democrats on Tuesday released a more than 200 page climate plan that they’re billing as a roadmap for what they’ll do if they can take back the majority after this year’s election. The sprawling report has the broad goals of increasing federal spending on climate action to 2 percent of gross domestic product each year and creating 10 million new jobs. It also calls for the whole world to reach net-zero emissions by 2050.

The Hill: 87 Lawmakers Ask EPA to Reverse Course After Rescinding Methane Regulations

A coalition of 87 House lawmakers is asking the Environmental Protection Agency (EPA) to withdraw its latest rules rescinding standards for methane emissions in the oil and gas industry. “Methane is one of the most potent greenhouse gases driving climate change — 84 times more powerful than carbon dioxide in the first two decades after its release,” the members wrote in the letter, which was signed by 85 Democrats and two Republicans.


COVID-19 Legislative & Regulatory Trackers

NEW TODAY...

— HHS EXTENDS PROVIDER RELIEF FUND APPLICATION DEADLINE. The Department of Health and Human Services (HHS) has extended the deadline to apply for funding through the CARES Act Provider Relief Fund to Sunday, Sept. 13.

— TRUMP ADMINISTRATION PUBLISHES NEW RULES AIMED AT BOLSTERING COVID-19 DATA. The Trump administration published new rules outlining COVID-19 testing and reporting requirements aimed at fighting outbreaks in nursing homes and gaining more data on the pandemic from hospitals and laboratories.

  • The new interim final rule mandates that hospitals report a slew of data daily, such as the number of confirmed or suspected coronavirus patients and how many ICU beds are occupied. It also levies fines against laboratories and nursing homes conducting COVID-19 testing for individual patients if they do not report daily results to HHS.

— CMS LAUNCHES NEW NATIONAL NURSING HOME TRAINING PROGRAM. The Centers for Medicare and Medicaid Services (CMS) announced that it has launched a new national training program for frontline nursing home staff and management aimed at providing more knowledge to mitigate the spread of COVID-19.


RECENT DEVELOPMENTS...

— CMS ISSUES BULLETIN ON MEDICAID REIMBURSEMENT STRATEGIES TO PREVENT SPREAD OF COVID-19 IN NURSING FACILITIES. CMS issued a Medicaid Informational Bulletin outlining guidance to states on flexibilities that are available to increase reimbursement for nursing facilities that implement specific infection control practices.

  • This includes information on the Disaster State Plan Amendments (SPA) template and describes how states may use state-directed payments to increase reimbursement to nursing facilities in managed care

— HHS ADDS HEALTH PLANS TO JUNE 2020 PLASMA DONATION GUIDANCE.

The Office of Civil Rights (OCR) at HHS issued amended guidance on how the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rule permits covered health care providers and health plans to contact their patients and beneficiaries who have recovered from COVID-19 to inform them about how they can donate their convalescent plasma.

  • The guidance emphasizes that, without individuals' authorization, the providers and health plans cannot receive any payment from, or on behalf of, a plasma donation center in exchange for such communications with recovered individuals.

— FDA GRANTS EMERGENCY USE FOR CONVALESCENT PLASMA TREATMENTS. The Food and Drug Administration (FDA) issued an emergency use authorization (EUA) for investigational convalescent plasma for the treatment of COVID-19 in hospitalized patients.


— TRUMP ADMINISTRATION INVOKES DPA FOR NURSING HOME RAPID TESTS. HHS announced that it has invoked the Defense Production Act (DPA) to secure rapid COVID-19 tests and supplies for roughly 14,000 nursing homes across the country.

— FDA ISSUES GUIDANCE ON PRODUCT INSPECTIONS DURING THE COVID-19 PUBLIC HEALTH EMERGENCY. FDA published a final guidance document outlining answers to questions about regulatory and policy issues pertaining to inspections, pending drug applications, and changes in manufacturing facilities for approved pharmaceuticals.

— TRUMP ADMINISTRATION SCALES BACK FDA REVIEW OF CERTAIN COVID-19 TESTS. HHS announced yesterday that it will allow COVID-19 tests developed by individual laboratories to be used without a review from the Food and Drug Administration (FDA)

— HHS MOVES TO EXPAND ACCESS TO COVID-19 VACCINES FOR CHILDREN. HHS issued an amendment to the Declaration under the Public Readiness and Emergency Preparedness Act (PREP Act) aimed at increasing access to the childhood vaccines.

  • The amendment authorizes State-licensed pharmacists to order and administer vaccines to individuals ages three through 18 years, subject to several requirements.

— FDA ISSUES RECOMMENDATIONS FOR INVESTIGATIONAL COVID-19 CONVALESCENT PLASMA. FDA has issued guidance that outlines recommendations to health care providers and investigators on the administration and study of investigational convalescent plasma collected from individuals who have recovered from COVID-19.


— UPDATED ANALYSIS OF THE PROVIDER RELIEF FUND. HHS continues to make distributions under the $175 billion provider relief fund made possible by the CARES Act and successor legislation. Click here to read TRP’s analysis of the distributions.

  • Recently, the agency announced $1.4 billion in new funding for children’s hospitals and an extended deadline of August 28 for Medicaid, CHIP, and dental providers to apply for relief.

  • Furthermore, the agency reopened applications for one of the initial tranches of funding, allowing providers who missed the first opportunity or were ineligible to seek CARES Act funds.

— TRUMP ADMINISTRATION ANNOUNCES 'WARP SPEED' COLLABORATION WITH MCKESSON ON VACCINE DISTRIBUTION. HHS and the Department of Defense (DoD) announced a new "Operation Warp Speed" collaboration with McKesson Corporation that would make the company a central distributor of future COVID-19 vaccines and related supplies.


— HHS SENDS NEW PROVIDER RELIEF FUNDS TO CHILDREN'S HOSPITALS. HHS, through the Health Resources and Services Administration (HRSA), announced $1.4 billion in provider relief funding to dozens of free-standing children’s hospitals nationwide. 

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