COVID-19 Federal Update (3/25)

Late last night, Senate Minority Leader Chuck Schumer (D-NY) and Treasury Secretary Steven Mnuchin struck a bipartisan agreement on a $2 trillion COVID-19 stimulus deal following days of intense negotiations. In a “Dear Colleague” letter to members, Leader Schumer outlined several funding streams Democrats were able to secure in the final bill, including: (1) $150 billion for a state, local, and tribal fund; (2) $100 billion in emergency funds for hospitals; and (3) $10 billion in small business grants up to $10,000 aimed at alleviating operating costs. The Democratic leader also lauded policy wins on unemployment insurance, direct payments to individuals, and oversight of the $500 billion allocated toward distressed industry relief.

Senate Majority Leader Mitch McConnell (R-KY) expressed confidence that the Senate would be able to pass the bill today, noting that the finalized bill text should be public around noon. While House leadership is eyeing passage of the bill via unanimous consent, it remains to be seen whether this strategy will pan out as some lawmakers on both sides of the aisle have expressed concerns about passing an economic stimulus bill by voice vote. As such, a concrete strategy and timing in the House remains in flux as of this point. The next “pro forma” session in the lower chamber is currently scheduled for 11 AM tomorrow morning.

COVID-19: What We’re Hearing

  • COVID-19 3.0. Once the updated bill text is released, the Senate is expected to vote on the Motion to Proceed to consideration of the bill, which requires support from 60 Senators.  
  • When the motion is adopted, the Senate will have up to 30 hours of debate at which point the Senate will vote on Cloture to end debate, also a 60 vote threshold. Final passage with a majority of the Senate would follow. 
  • After the Senate passes the stimulus deal, it will be sent to the House. There remains uncertainty about how the House will vote on the package. 
  • House Rules Committee Chairman James McGovern (D-MA) circulated a staff memorandum to lawmakers outlining two primary options: (1) convene for a “pro forma” session where they can pass the bill by unanimous consent; or (2) adopt a rule change and allow members to vote by proxy. 
  • We believe if members oppose the bill and want to be on record, the second option will be pursued.
  • Additional COVID-19 Legislation. House Majority Leader Steny Hoyer (D-MD) told Democrats yesterday that lawmakers will likely take up additional COVID-19 response legislation during the balance of the 116th Congress.
  • Leader Hoyer teased possible “Phase IV” and “Phase V” legislative packages that could be taken up later this year.
  • ACA. Rumors out of the Centers for Medicare and Medicaid Services (CMS) suggest that the agency is considering reopening the enrollment period for the Affordable Care Act (ACA) in response to the COVID-19 emergency.
  • Buy American EO. The Trump administration is reportedly considering a “Buy American” executive order that seeks to exercise war powers to bolster manufacturing capacity.
  • A timeline for when the order could be issued is fluid. Reports indicate that there has been considerable push back on the policy within the White House.
  • Rumors speculate that the order would: (1) limit or prohibit exports of certain pharmaceutical and medical products aimed at protecting the U.S. drug supply chain; (2) promote dramatic expansions of the US Strategic and Active Pharmaceutical Ingredients (API) Stockpiles; and (3) crack down on companies from providing investigational medicines for emergency use to other countries.

COVID-19: What’s Happened

  • FDA. The Food and Drug Administration (FDA) announced new actions to increase U.S. supplies to support COVID-19 response efforts by providing instructions to manufacturers importing personal protective equipment (PPE) and other devices.
  • FDA has provided new guidance on patient access to certain Risk Evaluation and Mitigation Strategy (REMS)-requited drugs during the COVID-19 public health emergency.
  • FDA issued guidance allowing manufacturers of certain non-invasive, FDA-cleared devices to expand their use so that health care providers can use them to monitor patients remotely.  
  • FDA issued emergency authorization for a rapid point-of-care test that can deliver results in 45 minutes.
  • The Food and Drug Administration (FDA) is suspending routine surveillance inspections for food, drugs, medical devices and tobacco to protect its workers from COVID-19 and because of industry concerns about visitors. Inspections triggered by specific reasons, like contamination, outbreaks or other emergencies, will continue.
  • FDA Commissioner Stephen Hahn announced that state public health departments across the country can now unilaterally authorize laboratories to test for COVID-19. FDA will also allow diagnostics manufacturers to distribute certain testing kits prior to the federal government granting emergency use authorizations.
  • CMS. The Centers for Medicare and Medicaid Services (CMS) announced that it is taking steps to implement provisions of the Families First Coronavirus Response Act that provide states with additional Medicaid funding.
  • CMS approved Medicaid Section 1135 Waivers for 11 states in response to the COVID-19 outbreak. These states include: Alabama, Arizona, California, Illinois, Louisiana, Mississippi, New Hampshire, New Jersey, New Mexico, North Carolina, and Virginia
  • CMS released a new targeted plan for health care facility inspections in light of the outbreak.
  • CMS announced that it is granting exemptions from reporting requirements and granting extensions for clinicians, providers, and facilities participating in Medicare quality reporting programs.
  • CMS released a list of frequently asked questions regarding COVID-19 actions on provider enrollment and waiving certain screening requirements.
  • CMS posted a recording of its Mar. 17 “All-State” call with state Medicaid and CHIP agencies. Additionally, the agency launched a new Medicaid COVID-19 resource page that will contain the latest updates and relevant information.
  • CMS posted Frequently Asked Questions (FAQs) to aid state Medicaid and Children’s Health Insurance Program (CHIP) agencies in their response to the outbreak.
  • EO on Medical Resources. President Trump signed an executive order that seeks to stymie hoarding of health and medical resources to respond to the spread of COVID-19.
  • President Trump issued an executive order on prioritizing and allocating resources to respond to the spread of COVID-19.
  • SEC. The Securities and Exchange Commission (SEC) has extended its conditional exemptions from reporting and proxy delivery requirements for public companies, funds, and investment advisers affected by the outbreak. 
  • The Fed. The Federal Reserve will be scaling back its examination of banks to focus more intently on the potential risks that arise from the outbreak.
  • The Federal Reserve announced a series of emergency moves aimed at stemming the economic impact of the outbreak. These actions include three new emergency lending facilities, as well as a new program that will support lending to eligible small-and medium-sized businesses that support efforts by the Small Business Administration (SBA).
  • The Federal Reserve announced that it will establish a Primary Dealer Credit Facility to support dealers’ market-making as the economy continues to slow due to the COVID-19 pandemic.
  • The Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) outlined actions aimed at providing banks additional flexibility to support households and businesses during the outbreak. Details on these steps can be read here.
  • The Fed slashed interest rates to a range of 0-0.25 percent, and will buy hundreds of billions of dollars in bonds in an effort to stave off economic hardships.
  • REAL ID. President Trump announced that the federal government would be extending the compliance deadline for REAL ID, responding to concern from the travel industry as well as lawmakers, who have been increasingly worried that a rush to DMVs to meet the Oct. 1 deadline could put people at risk 
  • Tech. The White House announced the launch of a new COVID-19 High Performance Computing Consortium aimed at providing researchers with access to computing resources needed to bolster scientific research on the virus.
  • The Trump administration issued a call to action urging the tech industry to collaborate and utilize data on COVID-19 and related viruses using artificial intelligence (AI). It includes curated articles and data compiled by the Allen Institute for AI. Additional information on this database can be found here.
  • Legislative Response. The Treasury Department and IRS announced the immediate implementation of certain paid sick and family leave requirements mandated by the second COVID-19 legislative response package. TRP’s full analysis of the bill can be read here. A breakdown of the paid leave provisions can be found here.
  • An $8.3 billion emergency supplemental appropriations bill, cleared both chambers and was signed into law on Mar. 6.
  • USTR. The Office of the United States Trade Representative (USTR) opened a comment docket for members of the public, businesses, and government agencies to submit comments if they believe further modifications to the 301 tariffs may be necessary in response to the outbreak.  
  • NIH. The National Institutes of Health (NIH) announced that it will be shifting all non-mission-critical laboratory operations to a maintenance phase as the agency looks to reduce the risk of COVID-19 transmission among staff. Activities that will continue include research for participants in non-elective critical trials, COVID-19 research, and urgent public health research recommended by NIH leadership.
  • Telehealth. CMS released new telehealth guidance that expands the list of eligible services and providers as well as waives HIPAA requirements. It also clarifies that states have the authority without guidance or approval from the agency to waive policies within the Medicaid program. TRP’s full analysis of the COVID-19 telehealth policies can be read here.
  • VA. Veterans’ Affairs (VA) Secretary Robert Wilkie announced that the VA is preparing to deploy 3,000 doctors, nurses and other emergency personnel — along with mobile hospitals and pharmacies — to bolster COVID-19 response efforts.
  • Funding Requests. The Trump administration, spearheaded by Secretary Mnuchin, submitted its $1 trillion stimulus request outlining priorities for the third phase of COVID-19 response legislation. 
  • OMB Acting Director Vought submitted a letter to Congressional appropriators with a request for $46 billion for agencies that have been stretched thin by the efforts to combat the outbreak.
  • IRS. Treasury Secretary Steven Mnuchin stated that the Internal Revenue Service (IRS) will push the tax filing deadline back three months from the April 15 date in response to the pandemic.
  • Travel Restrictions. President Trump tweeted that the U.S. will be closing the northern border to Canada to all non-essential traffic. Trade will not be effected.
  • President Trump announced that he would suspend all travel from Europe to the United States for the next 30 days in addition to existing travel restrictions from China and Iran.
  • Social Distancing. The Trump administration issued guidance that outlined a number of suggestions aimed at stemming the spread of COVID-19. The guidance outlines a series of steps — including avoiding social gatherings of 10 or more people — aimed at mitigating the spread of the virus over the course of the next 15 days.
  • Centers for Disease Control and Prevention (CDC) issued guidance recommending that Americans cancel or postpone gatherings of 50 more people for the next eight weeks.
  • Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases (NIAID), stated that Americans should be prepared to “hunker down significantly more” as the federal government ponders additional steps to stem the spread of the outbreak.
  • National Emergency. President Trump declared a national emergency in response to the COVID-19 outbreak, invoking the Stafford Act that allows the administration to provide more federal aid for states and municipalities.
  • This declaration would allow the states to request a 75 percent federal cost-share from the Federal Emergency Management Agency (FEMA) for expenses related to the outbreak, including medical tests and supplies, vaccinations, emergency workers, etc.
  • The national emergency declaration will also allow CMS to utilize Section 1135 waivers to provide flexibility to health care providers and state agencies during the outbreak.

Supreme Court. SCOTUS announced that it will postpone its next two weeks of oral arguments — a move that could complicate the remainder of the court’s docket for this term.

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