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House Passes Revised COVID-19 Relief; Negotiations Continue

October 2, 2020

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CONTACTS
Allyson Perleoni, Senior Legislative Analyst
Christa Wagner, Senior Legislative Analyst
Jason Kleinman, Senior Legislative Analyst, Govt. Relations
Brett Roude, Legislative Analyst

The House of Representatives passed another COVID-19 relief package (H.R. 8406) in a 214-207 vote on Sept. 28, scaling back its original Health and Economic Recovery Omnibus Emergency Solutions (Heroes) Act (H.R. 6800) that passed in May [see Washington Highlights, May 15]. The legislation follows months of unsuccessful negotiations on a new COVID-19 relief bill between House Speaker Nancy Pelosi (D-Calif.), Treasury Secretary Steve Mnuchin, White House Chief of Staff Mark Meadows, and Senate Majority Leader Mitch McConnell (R-Ky.).

The updated Heroes Act would spend $2.2 trillion dollars on COVID-19 relief — down from $3.4 trillion initially proposed in the previous version.

Like the original version of the Heroes Act, the updated bill includes $4.7 billion for the National Institutes of Health, including $3 billion for research relief. The updated bill provides some new funding for the National Science Foundation (NSF), with the ability for the NSF to use that funding to extend existing grants.

The updated House bill maintains the $75 billion included in the original Heroes Act for the bill’s COVID-19 National Testing and Contact Tracing program. The bill also increases the funding provided for vaccine development and purchases through the Biomedical Advanced Research and Development Authority to $21 billion.

The revised Heroes Act increases funding for the Centers for Disease Control and Prevention (CDC), providing it with an additional $12 billion over the original bill, including $7 billion for vaccine distribution, $1 billion for a public awareness campaign on the importance of vaccinations, and funding for personal protective equipment, global disease detection, and seasonal flu activities.

Also included in the legislation is an additional $50 billion for the Provider Relief Fund, which was initially established in the Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136) and expanded in the Paycheck Protection Program and Health Care Enhancement Act (P.L. 116-139) [see Washington Highlights, March 27April 24]. This is $50 billion less than what the House passed in May. In addition to increasing the fund’s resources to reimburse for health care-related expenses or lost revenue attributable to the coronavirus, the bill codifies the fund with a new algorithm and distribution mechanism.

The proposal includes several provisions related to Medicaid. It would increase Federal Medical Assistance Percentage payments to state Medicaid programs by a total of 14 percentage points from Oct. 1, 2020 through Sept. 30, 2021. It also temporarily increases Medicaid disproportionate share hospital allotments by 2.5%.

Additionally, the bill would help make health care coverage accessible to those currently uninsured or who have recently lost their job. It provides a special two-month open enrollment period to allow uninsured individuals to enroll in coverage through the Affordable Care Act (ACA) marketplace. It also would provide premium tax credits for those who have lost their job during the public health emergency. For 2020 and 2021, individuals who are receiving unemployment compensation would be able to access ACA premium tax credits regardless of income. For those with higher incomes, tax credits would be determined as if their income was 133% of the poverty level.

The legislation includes $800 million in new supplemental funding for the National Health Service Corps. This funding will support scholarship and loan repayment options for physicians who practice in health professions shortage areas [see Washington Highlights, June 26].

The revised Heroes Act would provide $26.7 billion in emergency aid to public higher education institutions and $7 billion in emergency aid to nonprofit private institutions for “education and general expenditures (including defraying expenses due to lost revenue, reimbursement for expenses already incurred, and payroll) and grants to students for expenses directly related to coronavirus.”

On student loans, the legislation extends the suspension of payments for federal student loans, interest accrual, and interest capitalization through Sept. 30, 2021 [see Washington Highlights, Aug. 27]. The bill also incorporates several technical corrections to the CARES Act (P.L. 116-136) that would benefit medical education, such as allowing DACA recipients to receive emergency grant aid related to COVID-19 and expanding the definition of student loans eligible for the suspension of payments and interest accrual.

The legislation does not contain liability measures — a key priority for Leader McConnell. McConnell has panned the legislation, stating that it will likely not be considered by the Senate in its current form.

Release of the bill had renewed discussions between Speaker Pelosi and Secretary Mnuchin, who reportedly has floated the prospect of a $1.62 trillion package, but negotiators have not reached an agreement.

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