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House Introduces $3 Trillion Funding Bill

May 13, 2020

McDermott+Consulting

On May 12, 2020, the House Democrats released a fifth emergency funding bill in response to the Coronavirus (COVID-19) pandemic, the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act. This $3 trillion bill funds a wide range of initiatives and funds existing policies. The House is expected to vote on this proposal as early as Friday and it is expected to pass without Republican support.  It is not expected that Senate Republicans will take this bill up and more likely Democrats will use it as a negotiation tool. The President has also indicated that he believes it is too soon for another funding bill.

Key healthcare-related Provisions of the bill include:

Public Health and Social Services Emergency Fund: An additional $175B to reimburse for healthcare-related expenses or lost revenue attributable to the coronavirus, as well as to support testing and contact tracing to effectively monitor and suppress COVID-19, including:

  • $100B in grants for hospital and healthcare providers to be reimbursed healthcare-related expenses or lost revenue directly attributable to the public health emergency resulting from coronavirus (additional dollars to the Provider Relief Fund); and
  • $75 billion for testing, contact tracing, and other activities necessary to effectively monitor and suppress COVID-19.

As conditions for accepting funds the recipient must agree to no balance billing, funds cannot be used for executive compensation (as described in the Coronavirus Aid, Relief, and Economic Security (CARES) Act), and funds cannot be accepted for losses that have been reimbursed by another source.

Health Resource Services Administration: $7.6B for health centers to expand the capacity to provide testing, triage, and care for COVID-19 and other healthcare services.

Centers for Disease Control: $2.1B to support federal, state, and local public health agencies to prevent, prepare for and respond to the coronavirus.

Assistant Secretary for Preparedness and Response: $4.575 billion to respond to coronavirus including $3.5B for Biomedical Advanced Research and Development Authority (BARDA) for therapeutics and vaccines; $500M for BARDA to support U.S. based next-generation manufacturing facilities; and $500M for BARDA to promote innovation in antibacterial research and developments.

Medicare Accelerated and Advance Payment Program: This provision lowers the interest rate for loans to Medicare providers made under the Accelerated and Advance Payment Program to from nearly 10% to 1%, reduces the per-claim recoupment percentage to 25%, extends the period before repayment begins from 210 days to one year, and extends the repayment period to at least 2 years.

  • The bill also codifies the Advanced Payment Program for Part B suppliers and moves the payments out of the AAP to general Treasury funds, rather than out of the Medicare Trust Fund, which removes some concerns around solvency of the Trust Fund.

Additionally, there are provisions related to special enrollment periods for the exchanges and a variety of issues related to COVID-19 testing.

Stay up-to-date on COVID-19 emerging issues through the McDermottPlus Coronavirus Resource Center or the McDermott, Will & Emery Coronavirus Resource Center.

 

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For more information visit the McDermottPlus Payment Innovation Resource Center or contact Sheila Madhani at 202-204-1459/smadhani@mcdermottplus.com, Mara McDermott at 202-204-1462/mmcdermott@mcdermottplus.com or Rachel Stauffer at 202-204-1460/rstauffer@mcdermottplus.com.

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