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Public Policy Newsletter Article

Senate Releases Covid Relief Package

  • 2020-07-30T15:00:00.000+0000
  • Washington DC
  • Author: Laure Fabrega

On July 27, Senate Republicans released a compilation of eight bills, to be known as the Health; Economic Assistance; Liability Protection; and Schools (HEALS) Act. The legislative package, which is subject to change, is the result of negotiations between Senate Republicans and the Administration and is set to be the last covid-19 legislation before the November election. Negotiations will also need to happen with the House, which passed its own package, the HEROES Act, on May 15. Please find below a summary of the six bills relevant to our industry:

Safely Back to School and Back to Work Act
Title I of the bill contains health care provisions related to our industry (title II relates to education, child care, and workforce provisions):

– Sec. 101 requires HHS to establish policies to facilitate access to samples of infectious disease agents for public and private entities developing vaccines, treatments and diagnostic tests
– Sec. 102 supports domestic manufacturing surge capacity of medical countermeasures and platform technologies
– Sec. 103 establishes state stockpiles of medical products and supplies, including PPE; requires states to submit stockpiling plans to HHS and HHS to provide guidance to states; authorizes funding to maintain such supplies
– Sec. 104 restocks the Strategic National Stockpile (SNS) through partnerships with manufacturers and distributors
– Sec. 105 requires HHS to publish guidance for states and Indian tribes on accessing resources from the SNS
– Sec. 106 integrates lab testing and epidemiology systems into existing surveillance programs to improve the exchange of electronic health information
– Sec. 107 creates ten regional Centers for Public Health Preparedness to support state and local health departments
– Sec. 108 allows employers to offer telehealth to employees who don’t qualify for their employer’s coverage or are part-time
– Sec. 109 prohibits the use of human genetic information collected for diagnostic and serologic testing for other uses

Restoring Critical Supply Chains and Intellectual Property Act
– Title I sec. 102 requires HHS to purchase covered items for the SNS which are manufactured in the US. Covered items include PPE, sanitizing supplies, and ancillary medical supplies such as disinfecting wipes, privacy curtains, beds and bedding, testing swabs, gauze and bandages, tents, tarpaulins, covers, or bags. Exceptions are provided for items deemed non-available or that do not exceed $150K. The percentage of contracts by value entered into for covered products should be increased incrementally to 100% within the next 5 years at the latest.
– Title I sec.103 establishes the Qualifying Medical Personal Protective Equipment Manufacturing Project Credit, a 30% tax credit against equipment costs associated with PPE manufacturing
– Title I sec.104 allows manufacturers receiving the tax credit to bring intangible property used in connection with the production of PPE back to the United States without taxable gain.
– Title II aims at limiting foreign engagement in research. Sec. 206 would place greater requirements on J visas, which are used by research universities to sponsor foreign researchers.

American Workers, Families, and Employers Assistance Act
– Title I sec.101 provides an additional $200 per week in unemployment benefits in August and September (the current $600 benefit stops at the end of July), then 70% of lost wages starting in October (up to $500).
– Tile I sec. 102 increases states’ reimbursement to nonprofits, government agencies and tribes from 50% to 75% of costs incurred.
– Title II sec 201 and 202 clarify that deceased and imprisoned people aren’t eligible for recovery rebates.
– Title II sec. 211 enhances coordination between the employee retention tax credit (ERTC) and the Paycheck Protection Program by allowing employers to be eligible for both programs, but with limitations to prevent overlapping benefits.
– Title II sec. 213 establishes a refundable payroll tax credit equal to 50 percent of an employer’s “qualified employee protection expenses,” such as testing for COVID-19, PPE, cleaning supplies, “qualified workplace reconfiguration expenses,” including modifications to workspaces for the purpose of protecting employees and customers from the spread of COVID-19, and “qualified workplace technology expenses.”
– Title III sec. 301 maintains 2021 Medicare Part B premium and deductible at 2020 levels.
– Title III sec. 302 delays the date on which hospitals and other providers must start to repay Medicare Accelerated and Advance payment loans until January 1, 2021.
– Title III sec. 303 extends the telehealth waivers in Medicare enacted in previous recovery packages through the length of the public health emergency, or December 31, 2021, whichever is later; requires that the Medicare Payment Advisory Commission provide a report on the impact of telehealth flexibilities on access, quality, and cost by July 1, 2021; and requires that HHS post data on the use of telehealth throughout the pandemic and provide legislative recommendations to Congress.
– Title III sec. 304 specifies that the expansion of telehealth in Medicare for Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) provided in the CARES Act continues for five years beyond the end of the public health emergency.
– Title III sec. 305 allows Flexible Spending Account (FSA)/Dependent Care Flexible Spending Account (DCFSA) unused 2020 contribution amounts to be rolled over into the 2021 plan year.
– Title III sec. 311 to 315 deals with nursing homes.

Continuing Small Business Recovery and Paycheck Protection Program Act
– Title I authorizes improvements to the Paycheck Protection Program (PPP), including additional eligible expenses (sec. 101), borrower’s choice of covered period for forgiveness (sec. 103), and simplified application (sec. 104). The bill also creates PPP second draw loans (sec. 106) and reduces the maximum amount borrowers can receive under the first round of PPP from $10 million to $2 million. It also amends the terms of 7(a) loans for seasonal businesses and businesses located in small business low-income census tracts (sec. 112), and expands eligibility for 501(c)(6) with limited employees and lobbying expenses; among many others.
– Title II rescinds $100 billion from the CARES Act in direct appropriations and appropriates $190 billion for PPP and second draw loans.

Coronavirus Response Additional Supplemental Appropriations Act, 2020
This appropriations measure provides emergency supplemental funding for federal agencies. Here is the breakdown for health agencies important to our industry:
– $3.4 billion to CDC, including $1.5 billion to continue supporting state, local, and territorial public health needs; $500 million to enhance seasonal influenza vaccination efforts; $200 million to enhance global public health security efforts; and $200 million to modernize public health data reporting.
– $15.5 billion to NIH, including $10.1 billion to reopen NIH-funded research laboratories and reconstitute lost research and $1.24 billion for the ACTIV public-private partnership to prioritize and speed the development of treatments and vaccines.
– $20 billion for BARDA.
– $2 billion for the Strategic National Stockpile.
– $16 billion for testing, contact tracing, and surveillance in states.
– $6 billion to develop and execute a new COVID-19 vaccination distribution campaign coordinated through CDC.
– $150 million to CMS to increase survey frequency of skilled nursing facilities and nursing facilities.

– Title I provides temporary and targeted liability protections against coronavirus-related claims for companies, non-profits, educational institutions, and state and local governments that follow federal and state guideline during the pendency of the pandemic.
– Title II sec. 201 amends the PREP Act to include drugs, biologics, and devices in the definition of countermeasures for the purpose of product liability during the pandemic.