House Approves HEROES Act

The US House of Representatives on May 15, 2020, approved the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act a massive new relief and stimulus measure assembled by House Democrats and advanced on party lines, with only one Republican voting in favor. It invests nearly $3 trillion in testing capacity, workforce development and economic recovery. The bill would allocate an additional $100 billion for the Provider Relief Fund and establish specific rules and an application process for distributing these funds. It would create more favorable repayment terms for the Accelerated and Advance Payment Program and expand eligibility for the Paycheck Protection Program. It also provides $75 billion to state, local, and tribal health departments to support testing, contact tracing, and other efforts to mitigate the spread of COVID-19. Other key provisions would increase the Federal Medical Assistance Percentage by 14% from July 1, 2020, through June 30, 2021; boost Medicaid Disproportionate Share Hospital payments by 2.5%; and block the Administration from finalizing the Medicaid Fiscal Accountability Regulation, a controversial new rule proposed in November 2019, during the public health emergency.

The HEROES Act will not be enacted in its current form. The President issued a veto threat and Senate Republicans said the upper chamber will not consider the bill. Senate Republicans have not publicly committed to a timeline for another stimulus package, but have begun to gather ideas for the next phase. Many Republicans have indicated that they need to see how already appropriated, but not distributed, federal dollars sustain various aspects of the US economy. It is expected that the HEROES Act will serve as a messaging tool to convey Democrats’ priorities as the parties enter future negotiations.

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