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May 22, 2020

Health Law Weekly

COVID-19: Updates and Developments (Week of May 18)

  • May 22, 2020

The House passed May 15 by a 208-199 margin a $3 trillion relief package for the coronavirus pandemic, but the measure doesn’t have the support of the White House or Republican lawmakers.

The Health and Economic Recovery Omnibus Emergency (Heroes) Act (H.R. 6800) includes nearly $1 trillion in funding for state and local governments; an additional $75 billion for COVID-19 testing, contact tracing, and isolation measures; more direct payments to individuals and families; and a host of other provisions.

House Speaker Nancy Pelosi (D-CA) said the measure could serve as a starting point for further negotiations. Republicans, however, have blasted the measure, calling it a liberal wishlist” that “stands no chance of becoming law.” Senate Majority Leader Mitch McConnell (R-KY) and the White House have acknowledged that another relief package will likely be necessary but without indicating any specific timeline.

Agency Action

Department of Health and Human Services (HHS)

May 22—HHS is distributing $4.9 billion in provider relief funding to skilled nursing facilities (SNF) to combat and address the effects of COVID-19. Each SNF will receive a fixed distribution of $50,000, plus a distribution of $2,500 per bed, HHS said. All certified SNFs with six or more certified beds are eligible. Nursing home recipients must attest that they will only use Provider Relief Fund payments for permissible purposes, as set forth in the Terms and Conditions, and agree to comply with future government audit and reporting requirements.
May 20—HHS’ Health Resources and Services Administration (HRSA) awarded $225 million to 4,500 Rural Health Clinics (RHCs) across the country for COVID-19 testing. The funding was allocated to RHCs under the Paycheck Protection Program and Health Care Enhancement Act. Each clinic site will receive nearly $50,000, the agency said. HRSA also awarded $500,000 to RHCs for technical assistance to ramp up testing.

May 19—HHS announced a four-year, $354 million public-private sector partnership led by Phlow Corporation to expand U.S.-based capacity to produce active pharmaceutical ingredients (APIs) and generic drugs to prevent or minimize drug shortages during the COVID-19 pandemic and future public health emergencies. HHS Secretary Alex Azar said the effort will help ensure the stability of the nation’s medical supply chains. The federal government and Richmond, VA-based Phlow are developing a prioritized list of APIs and medicines needed for the COVID-19 response. Phlow, along with industry partners AMPAC Fine Chemicals, Civica Rx, and the Medicines for All Institute at the Virginia Commonwealth University’s College of Engineering, also will work to expand U.S. advanced manufacturing capability for producing finished, sterile, injectable generic drugs for patients hospitalized with COVID-19. The contract could be extended up to ten years for a total of $812 million.

Centers for Medicare & Medicaid Services (CMS)

May 19—CMS authorized local Medicare Administrative Contractors (MACs) to set the payment amount for COVID-19 testing, both diagnostic and serology, until Medicare establishes national payment rates. CMS noted that for dates of service on or after April 14, Medicare has established a $100 payment rate for laboratory tests using high throughput technologies for rapid results.

May 18—CMS issued new guidance for state and local governments to consider in deciding when to reopen nursing homes, which have been at the epicenter of the COVID-19 outbreak. Given the vulnerable populations they serve, CMS recommends that nursing homes should be among the last facilities to reopen in the community. Among the factors state and local authorities should consider: case status in the community;  staffing adequacy; capacity for baseline and ongoing testing of residents and staff; access to adequate Personal Protective Equipment for staff; and local hospital capacity. CMS also recommends state survey agencies inspect nursing homes that had a significant COVID-19 outbreak before allowing them to reopen. Visitors should not be permitted until a nursing home reaches phase three; any visitors should be screened and be required to wear a facemask at all times.

Food and Drug Administration (FDA)

May 16—FDA issued an emergency use authorization (EUA) to Everlywell, Inc. for its at-home sample collection kit for COVID-19 diagnostic testing. FDA separately authorized two COVID-19 diagnostic tests to be performed at Fulgent Therapeutics and Assurance Scientific Laboratories on the samples collected using the Everlywell COVID-19 Test Home Collection Kit. Individuals who are screened via an online questionnaire can use the kit to self-collect a nasal sample at home using the Everlywell kit. FDA said additional tests for use with the Everlywell kit may be authorized in the future. Patients will receive test results through Everlywell’s independent physician network and their online portal. The kit and associated tests are available by prescription only.

Centers for Disease Control and Prevention (CDC)

May 20—CDC issued a framework for health care providers to follow in providing non-COVID-19 care during the pandemic. CDC previously recommended that health care providers delay elective care to mitigate the spread of COVID-19. The framework weighs the potential for patient harm in delaying care against the degree of local transmission (substantial, moderate, or minimal to none).

May 18—CDC awarded $11 billion in funding from the Paycheck Protection Program and Health Care Enhancement Act to state and local governments to support testing for COVID-19. State and local governments receiving funds must submit a COVID-19 testing plan to HHS, including the number of tests needed and monthly estimates of laboratory and testing capacity.

Other Developments

May 15—The Trump administration announced the framework of its new Operation Warp Speed initiative to speed the development, manufacturing, and distribution of COVID-19 medical countermeasures—vaccines, therapeutics, and diagnostics. Through the $10 billion public-private partnership the administration aims to have a vaccine available to Americans by January 2021.

May 15—Nearly all states with updated projections are expecting current fiscal year (FY) 2020 enrollment growth in their Medicaid programs to exceed pre-pandemic projections, a trend they anticipate will continue in FY 2021, according to a recent study released by the Kaiser Family Foundation. More than half of states with projections expected their Medicaid spending in FY 2020 to be above previously anticipated levels, while eight states expected no significant change and six expected somewhat lower spending due to lower utilization of health care services. Four in ten states with projections are expecting a Medicaid budget shortfall for FY 2020, which may be at least partially addressed through supplemental appropriations and additional federal support.