Insights

Today on the Hill: Special COVID-19 Edition (5/22)

May 22, 2020

Capitol Hill Update

Congress is gaining traction on a deal that would provide businesses who received Paycheck Protection Program (PPP) funding with more time and flexibility on spending these loans. Prior to adjourning yesterday, a bipartisan group of Senators introduced a bill that would double the loan forgiveness period to 16 weeks, allow businesses to use the loan funds for investments to reopen safely, and extend the program through December. Meanwhile, The House plans to vote on a similar bill from Reps. Dean Phillips (D-MN) and Chip Roy (R-TX) next week that would: (1) provide flexibilities on how small businesses use PPP loan funding; (2) give businesses 24 weeks to spend the funds instead of eight; and (3) eliminate a non-statutory requirement preventing non-payroll costs from accounting for more than 25 percent of loan forgiveness. If the two chambers are able to strike an agreement next week, it’s possible that the bill could land on President Donald Trump’s desk for signature prior to the end of the month.

COVID-19: What We’re Hearing

  • Upcoming Congressional Schedule. In the coming days and weeks ahead, lawmakers are poised to take up numerous must-pass priorities for the balance of the 116th Congress. This includes, among other things, fiscal year (FY) 2020 appropriations, the National Defense Authorization Act (NDAA), and reauthorization of expiring Surface Transportation and Water Resources Development programs. TRP’s outlook on the upcoming Congressional schedule can be read here.
    • House leadership has officially invoked its emergency remote work flexibilities given to them in the remote voting resolution to convene virtual hearings, markups, and consideration of key 2020 legislative priorities. Click here to read TRP’s analysis on the lower chamber’s new remote work rules.
  • GOP “CARES 2.0” Priorities. Treasury Secretary Steven Mnuchin stated yesterday that there is a “strong likelihood” there will need to be another COVID-19 relief bill. Click here to read TRP’s analysis of Secretary Mnuchin’s comments.
    • Liability. Senate Majority Leader Mitch McConnell (R-KY) 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 regarding the COVID-19 outbreak.
      • Leader McConnell emphasized that any future COVID-19 relief efforts must include these protections in order for the Senate to consider additional relief legislation. Democrats have largely been dismissive of these efforts, arguing that it would water down federal consumer protection efforts.
    • 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 that give employers a tax break for keeping workers on the payroll.
    • State and Local Governments. GOP lawmakers have floated policies that would promote more flexibility to use CARES Act funding to offset lost revenue.
      • Sen. Bill Cassidy (R-LA) and Bob Menendez (D-NJ) reintroduced their SMART Act legislation yesterday that would allocate $500 billion to state and local governments.
      • 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.
  • HEROES Act. The House passed the Democrats’ sweeping $3 trillion HEROES Act following weeks of intraparty negotiations and assessments of current COVID-19 response efforts. The bill is considered dead-on-arrival in the GOP-controlled Senate and White House. TRP’s comprehensive analysis of this legislation can be read here. 
    • As written, the bill would represent the largest federal response to the COVID-19 pandemic to date, with provisions that would provide another round of direct payments to individuals and families, additional funding for health care providers and COVID-19 testing, as well as nearly $1 trillion in aid to state and local governments.

COVID-19: What’s Happened

  • HHS. The Department of Health and Human Services (HHS) announced that it has begin distributing roughly $4.9 billion in COVID-19 provider funding to skilled nursing facilities.
    • HHS and the Health Resources and Services Administration (HRSA) allocated $225 million to Rural Health Clinics provided by the “Phase 3.5” legislation to bolster COVID-19 testing.
    • HHS and the Biomedical Advanced Research and Development Authority (BARDA) announced a four-year, $354 million agreement with Phlow Corporation aimed at expanding U.S.-based pharmaceutical manufacturing for COVID-19 response. TRP’s analysis of the agreement can be read here.
    • The Trump administration announced a framework and leadership for “Operation Warp Speed“— a national program aimed at accelerating the development, manufacturing, and distribution of COVID-19 diagnostics, treatments, and vaccines.
    • HHS and HRSA awarded $15 million in grant funding to 159 organizations across five health workforce programs to bolster telehealth capabilities in response to the COVID-19 pandemic.
  • CMS. Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma and Food and Drug Administration (FDA) Commissioner Stephen Hahn will hold a call today at 12:30 PM ET with stakeholders to discuss experiences, ideas, strategies, and insights pertaining to COVID-19 response efforts. Click here to register.
    • CMS released new guidance (press release) for state and local officials on reopening nursing homes. In a document that corresponds to the broader administration phases for opening up the U.S., the agency laid out several factors that it says should inform state and local health officials’ decisions on reopening.
    • CMS also offers nursing home-specific criteria for entry to each reopening phase, including considerations for visitation and other services, as well as the surveys that would be conducted during these phases. It recommends that nursing homes remain in the highest restriction state even as the rest of the community begins to relax restrictions due to the vulnerable nature of nursing home residents. The administration also recommends that state survey agencies inspect nursing homes that had previously dealt with an outbreak before they are permitted to reopen.
    • CMS released a CMCS Informational Bulletin that provides states with guidance on how to temporarily modify certain provider payment methodologies and capitation rates under their Medicaid managed care contracts during the public health emergency.
    • CMS announced a call for nominations for the new contractor-led Coronavirus Commission on Safety and Quality in Nursing Homes to help inform immediate and future responses to the Coronavirus Disease 2019 (COVID-19) within these facilities. 
    • CMS updated its list frequently asked questions related to the public health emergency for Medicare Advantages plans.
    • CMS released a new toolkit for nursing homes and state health agencies that provide a suite of best practices and resources to help fight the COVID-19 outbreak.
    • CMS published a tranche of frequently asked questions for state Medicaid and CHIP programs regarding COVID-19 response efforts. These FAQs cover a variety of topics.
    • CMS issued an interim final rule with comment period and blanket waivers under Section 1135 of the Social Security Act. These new flexibilities provide for Medicare coverage of serology tests, new coverage for services provided by pharmacists, and a waiver of the limitation on the types of practitioner that may furnish Medicare telehealth services.
    • A full list of the 1135 waiver approval letters can be accessed here.
  • FDA. The FDA posted a list of antibody tests that are being removed from the “notification list” of tests being offered under the Policy for Coronavirus Disease-2019 Tests During the Public Health Emergency. 
    • FDA published guidance documents related to drugs being developed for COVID-19. The first guidance document provides general recommendations to sponsors to help prepare them for pre-investigational new drug application (pre-IND) meeting requests for COVID-19 related drugs. The second guidance document is intended to assist sponsors in the clinical development of drugs for treating or preventing COVID-19.  
    • FDA issued an emergency use authorization for the first COVID-19 antigen test.
    • FDA published guidance on reporting requirements for medical device shortages.
    • FDA issued an emergency use authorization for the antiviral remdesivir.
    • FDA issued guidance outlining an exemption and exclusion from certain requirements of the Drug Supply Chain Security Act during the public health emergency.
    • FDA issued guidance that will temporarily allow hospitals to compound certain sedatives used for COVID-19 patients during the public health emergency. Additional details on this policy from the FDA can be read here.
  • EO on Deregulation. The Trump administration issued an executive order calling on agencies to target regulations “that may inhibit economic recovery” during the COVID-19 pandemic. Click here to read TRP’s analysis of this new order.
  • NIH. The National Institutes of Health (NIH) launched a study to investigate the whether the COVID-19 pandemic has resulted in pregnancy-related health issues. The agency plans to incorporate this data into broader registry on how COVID-19 impacts maternal health.
    • NIH issued its first guidance on COVID-19 treatment options that are currently under review.
    • NIH and the Foundation for the NIH (FNIH) announced that they will launch a new public-private partnership with more than a dozen biopharmaceutical companies aimed at speeding COVID-19 vaccine and treatment options.
  • SBA. The Small Business Administration (SBA) and Treasury Department updated their list of frequently asked questions on the PPP on May 19, 2020.
    • SBA provided an update on its PPP loan data, as well as an updated state-by-state breakdown.
    • SBA announced yesterday that agricultural businesses are now eligible for SBA’s Economic Injury Disaster Loan (EIDL) and EIDL Advance programs. 
    • SBA issued guidance on how to calculate PPP loans by business type.
    • SBA published a list of all lenders participating in the PPP.
    • SBA issued an interim final rule clarifying the process of applying for PPP loans for individuals who report self-employed income on a 1040 Schedule C
    • SBA issued an interim final rule outlining additional guidance for the PPP. TRP’s comprehensive analysis of the small business provisions contained in COVID-19 response bills can be read here. The loan application form can be accessed here.
  • Provider Funding. HHS announced that it has extended the deadline for providers to attest to the receipt of payments and accept the terms and conditions from 30 days to 45 days. TRP’s comprehensive analysis of these distributions can be read here.
    • To date, HHS is providing a $50 billion general allocation for Medicare hospitals and providers, $10 billion for hospitals in highly impacted areas, $10 billion for rural providers, and $400 million for the Indian Health Service. It also establishes a program to fund COVID-19 care for the uninsured.
    • HHS has published a list of frequently asked questions pertaining to the $50 billion general allocation of the COVID-19 provider relief fund. In addition, providers receiving funds must agree to a set of terms and conditions, including reporting and documentation requirements, charging only in-network rates for COVID-19 care, and certifying that the funds will only be used to prevent, prepare for, and respond to the outbreak.
    • HRSA launched a separate portal allowing providers who have conducted COVID-19 testing or provided treatment for uninsured COVID-19 individuals on or after February 4, 2020 to request reimbursement.
    • HHS also cited providers who will receive further, separate funding, including skilled nursing facilities, dentists, and providers that solely take Medicaid.
  • Legislative Response. TRP has published several in-depth policy memos that analyze actions that Congress and the federal government have taken to address the COVID-19 outbreak. Click here for the full list of memos.
    • CMS provided hospitals and other inpatient facilities new flexibilities that are intended to increase acute care hospitals’ capacity during the pandemic, as well as permitting off-campus hospital outpatient departments to apply to temporarily receive reimbursement under Medicare’s hospital outpatient prospective payment system, rather than under the physician fee schedule. TRP’s memo on these new flexibilities is available here.
    • Since the beginning of the COVID-19 outbreak, Congress and the Trump administration have issued a number of policies and waivers designed to lower restrictions on and encourage telehealth services. Click here to read TRP’s memo on these telehealth policies.
    • President Donald Trump signed the $483.4 billion “COVID-19 Phase 3.5” bill into law. TRP’s comprehensive analysis of the Phase 3.5 legislation can be read here.
    • TRP’s has published a memo explores the “health extenders” that the CARES Act reauthorized through Nov. 2020, what’s on the table for these programs in the fall, and the questions that will shape the conversation. Click here to read the memo.
  • Oversight. The Congressional Oversight Commission has issued its first report outlining how it will review the Treasury Department and Federal Reserve’s efforts to implement Subtitle A of the CARES Act. This will include an analysis of the lending programs and facilities designed for businesses and municipalities
  • The Fed. The Federal Reserve and other banking regulatory agencies made additional changes to the supplementary leverage ratio to increase banking organizations’ ability to support credit to households and businesses during the COVID-19 pandemic.
    • The Federal Reserve expanded the scope and duration of its Municipal Liquidity Facility to offer up to $500 billion in lending to states and municipalities during the pandemic.
    • The Federal Reserve and other banking regulatory agencies published an interim final rule that modifies the Liquidity Coverage Ratio to support banking organizations’ participation in the Money Market Mutual Fund Liquidity Facility and the PPP Liquidity Facility.
    • The Federal Reserve expanded access to its PPP Liquidity Facility for for additional lenders, and also broadened the criteria for collateral that can be pledged.
    • The Federal Reserve will expand the scope and eligibility for the Main Street Lending Program.
  • Treasury. The Treasury Department released a list of the payments that have been made to states and qualifying localities through the Coronavirus Relief Fund.
    • The Treasury Department has released a list of frequently asked questions pertaining to the Employee Retention Credit.
    • Treasury Secretary Steven Mnuchin issued guidance and frequently asked questions that provide examples of eligible and ineligible expenditures of the state, local, and tribal Coronavirus Relief Fund.
  • IRS. The Internal Revenue Service (IRS) published a list of frequently asked questions on COVID-related relief for retirement plans and IRAs.
  • Testing. The Trump administration released a blueprint that seeks to bolster state testing plans and rapid response programs.
  • SAMHSA. The Substance Abuse and Mental Health Services Administration (SAMHSA) awarded grant funding to increase access and improve the quality of community mental and substance use disorder (SUD) treatment services through the expansion of Certified Community Behavioral Health Clinics (CCBHC). 
  • FCC. The Federal Communications Commission (FCC) and the Department of Education announced efforts to promote the use of $16 billion in funding for the CARES Act’s Education Stabilization Fund for remote learning.
    • In a move aimed at expanding access to Wi-Fi throughout the country, the FCC voted to adopt a report and order that would make 1,200 megahertz of spectrum in the 6 GHz band available for unlicensed use.