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Public Policy Newsletter Article

Negotiations in Congress Continue after House Passage of Fourth Coronavirus Aid Bill

  • 2020-05-21T15:00:00.000+0000
  • Washington DC
  • Author: Laure Fabrega

On Friday May 15, the House passed H.R. 6800, the HEROES Act, the fourth measure to provide relief to individuals and businesses impacted by covid-19, by a 208-199 vote.

The Senate has indicated that it will not vote on the measure because of the partisan nature and the timing of the bill. In particular, Republicans objected to voting too soon on another aid measure without assessing the impact of previous measures, as well as provisions in the bill that they believe advance the Democratic agenda such as: billions in aid to state governments, provisions boosting the Affordable Care Act (ACA), and assistance for immigrants. Republicans want to bolster liability protections for businesses operating during the pandemic.

On the other hand, lawmakers are finding common ground on the need for improving Covid-19 testing in the U.S., revamping the Strategic National Stockpile, creating centers of manufacturing excellence, and strengthening oversight of the emergency funds going to health-care providers. Negotiations on a bipartisan package are ongoing but we may not see language for several weeks.

Please find below a summary of the $3 trillion and over 1,800 pages bill, with more details on provisions of interest to the life science industry:

  • State and local aid: $500 billion for state governments; $375 billion for local governments; $20 billion for tribal governments
  • PPP and EIDL Loans: PPP authorization would be expanded from June 10 to December 31; no additional funding for PPP but 25% set asides for companies with 10 or fewer employees and nonprofits; eligibility expanded to cover all nonprofits including 501(c)(4) and 501(c)(6); affiliation rules waived for nonprofits; forgiveness period extended; additional $10 billion for EIDL
  • Net Operating Losses (NOL): the measure amends the CARES Act to apply the provision to taxable years beginning on or after January 1, 2018. The language also limits carrybacks to taxable years beginning on or after January 1, 2018. This provision is limited based on factors relating to excessive executive compensation or excessive stock buybacks and dividends from carrying back losses.
  • Health funding: $100 billion for providers; $75 billion for a Covid-19 National Testing and Contact Tracing Initiative under the CDC, $7.6 billion for HRSA; $4.7 billion for the NIH; $2.1 billion for the CDC
  • Life science-related provisions: supply chain (BARDA directed to award contracts to enhance the manufacturing capacity of a Covid-19 vaccine and issue a report on vaccine manufacturing and administration capacity ; FDA authority to destroy imported counterfeit devices; $100 million to designate “National Centers of Excellence in Continuous Pharmaceutical Manufacturing”; FDA enforcement authority if a manufacturer doesn’t provide required notifications on supply chain interruptions or doesn’t develop required risk management plans; President required to appoint a medical supplies response coordinator); changes related to the Strategic National Stockpile ($500 million annually through FY 2023 for HHS to maintain domestic reserves of critical medical supplies; allows HHS to enter into contracts for equipment maintenance services for the stockpile; allows the stockpile to sell drugs and supplies that are less than six months from the expiration date to other federal agencies); Defense Production Act (Covid-19 tests, personal protective equipment, ventilators, and drugs would be deemed scarce and critical materials; heads of HHS and FEMA given the same authorities as the president related to providing incentives to expand domestic production); Pricing (the measure would declare it illegal to “sell a good or service at a price that is unconscionably excessive and indicates the seller is using the circumstances related to such public health emergency to increase prices unreasonably.” Covered goods include PPE, respirators, medical equipment and testing supplies, and drugs. The FTC would enforce the ban and state attorneys general could bring civil enforcement actions)
  • Coverage provisions: requirements for private insurers, Medicare, Medicaid, TRICARE, veterans’ health programs, and federal employee plans to fully cover treatments for Covid-19 without any patient cost-sharing; expanded payments and coverage for Medicare and Medicaid; premium subsidies for COBRA, special ACA enrollment period during the pandemic
  • Direct payments of up to $1,200 for individuals that qualify under the CARES Act (same income limits and phase-out)
  • $10,000 cap on SALT deductions suspended for 2020 and 2021
  • Other tax provisions: modifications of the earned income tax credit, child tax credit, dependent care, employee retention tax credit
  • Unemployment extensions and worker protections
  • Assistance for immigrants (extension of filing deadlines, 90-day extension of statuses, remote naturalization ceremonies, lesser visa requirements for health care workers in covid-related jobs)
  • Financial relief for students
  • Rental, homeowner, and homeless assistance
  • Food stamps and agricultural aid
  • Banking and consumer protections
  • Assistance to public transit systems and the aviation industry
  • Veterans benefits
  • Broadband expansion
  • Aid for the Postal Service and state prisons