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August 14, 2020

Health Law Weekly

COVID-19 Updates and Developments (Week of August 10)

  • August 14, 2020

Agency Developments

Department of Health and Human Services (HHS)

August 13—HHS is investing $6.5 million in two commercial diagnostic laboratories—Aegis Sciences Corp. and Sonic Healthcare USA—to expand capacity to conduct 4 million more COVID-19 tests per month. According to the agency, the investment will allow the labs to secure critical equipment, staffing, and infrastructure to perform the additional tests starting in early October.

August 11—HHS and the Department of Defense announced a $1.5 billion deal with Moderna, Inc. to manufacture and deliver 100 million doses of its COVID-19 vaccine. The agreement is the latest in a series of similar deals the administration has entered into under its Operation Warp Speed initiative to deliver COVID-19 vaccines to the American public by as soon as the end of the year. The manufacturing process will take place while clinical trials are underway to expedite the traditional vaccine timeline, HHS said. The government has the option to acquire up to an additional 400 million doses under the agreement.

August 10—HHS released on the agency’s website State Testing Plans for COVID-19 through the end of the year. The plans, developed by states, territories, and local jurisdictions, include details on target numbers of tests per month, responding to case surges, and reaching vulnerable populations including minorities, immunocompromised individuals, and older adults, HHS said. Each state was asked to detail how a minimum of 2% of its population would be tested each month, as well as plans to ramp up testing by fall 2020. The agency said the federal government is continuing to work to procure and distribute testing supplies, match laboratory reagents with each state’s specific needs, and provide technical assistance.

August 10—HHS is accepting applications for Phase 2 General Distributions from the Provider Relief Fund under the Coronavirus Aid, Relief, and Economic Security (CARES Act). The funding is available to providers who missed the June 3 deadline to apply for additional funding equal to 2% of their total patient care revenue from the $20 billion portion of the $50 billion Phase 1 General Distribution, including Medicaid, Children’s Health Insurance Program, and dental providers with low Medicare revenue and those providers who experienced a change in ownership. Funding will be available August 28.

August 7—HHS will begin distributing $5 billion in provider relief funds under the CARES Act in mid-August to nursing homes. The initial $2.5 billion will be distributed for nursing homes to increase testing, staffing, and personal protective equipment. For the first time, the remaining $2.5 billion distribution, which will occur in the fall, will be linked to nursing home performance, HHS said. “By linking these funds to performance in controlling COVID-19, we are providing powerful tools and incentives for nursing homes to better protect their residents from the virus,” HHS Secretary Alex Azar said.

Centers for Medicare & Medicaid Services (CMS)

August 12—CMS delayed the educational and operations testing period for the Appropriate Use Criteria (AUC) Program through Calendar Year 2021. The Protecting Access to Medicare Act of 2014 established the AUC Program, which requires practitioners to consult a qualified Clinical Decision Support Mechanism before ordering advanced diagnostic imaging services like computed tomography, positron emission tomography, nuclear medicine, and magnetic resonance imaging. The program, which was scheduled to begin in January 2021, is aimed at ensuring advanced imaging is only ordered in appropriate circumstances. According to CMS, practitioners whose ordering patterns are considered outliers ultimately will be subject to prior authorization. In July, the American Hospital Association (AHA) and the American Medical Association sent a joint letter to CMS requesting a delay of the AUC Program due to the reduction in imaging services and the financial and technological strain on providers as a result of the COVID-19 public health emergency. CMS agreed to delay the start of the program by one year, until January 1, 2022. At that point, claims that do not comply with the AUC Program will not be paid, CMS said.

August 6—In a tweet, CMS Administrator Seema Verma confirmed that the agency does not intend funds from the Paycheck Protection Program to impact Medicare payments to rural hospitals. She indicated that the agency plans to issue guidance on how hospitals should report those funds on their Medicare cost reports.

Other Developments

August 7—Senators Tina Smith (D-MN) and Bill Cassidy, MD (R-LA) unveiled bipartisan legislation that would provide states an additional $25 billion for COVID-19 testing, contact tracing, and isolation measures. Representatives Angie Craig (D-MN) and Phil Roe (R-TN) introduced a companion measure in the House. The Suppress COVID-19 Act would allow states to work together through interstate compacts or regional agreements to purchase tests and testing supplies.