On Saturday, March 6, 2021, by a vote of 50-49, the Senate amended and approved the American Rescue Plan Act of 2021, which is reconciliation legislation to provide $1.9 trillion in COVID-19 relief. The House of Representatives is scheduled to vote on the Senate-passed version on Tuesday before the bill moves to President Biden for his signature. Congressional Democrats are aiming to have the legislation enacted before March 14, 2021, when current unemployment benefits would expire.

The bill provides a variety of economic relief provisions, including $1,400 in direct payments to individuals; $400 per week in supplemental unemployment insurance benefits (up from $300 per week); an expanded child tax credit of $3,000 (and $3,600 for children under the age of six) that is fully refundable and paid on a monthly basis; an expansion of the child and dependent care tax credit; and a tripling of the earned-income tax credit. For state and local governments, the bill provides $360 billion. To help schools reopen safely, the bill provides $130 billion to K-12 schools and $40 billion to colleges and universities.

The American Rescue Plan also contains a number of healthcare-related provisions, including:

• $14 billion for vaccine distribution;
• $49 billion for COVID-19 testing, tracing, and genomic sequencing;
• $25 billion to expand community health centers, tribal health programs, and public health workforce programs;
• $8.5 billion added to the Provider Relief Fund, designated for rural hospitals;
• Full coverage, without beneficiary cost-sharing, for COVID-19 vaccines and treatments for up to a year after the public health emergency ends (the federal medical assistance percentage (FMAP) is increased to 100% for vaccine costs during the same time period);
• $10 billion under the Defense Production Act to purchase, manufacture, and distribute critical medical supplies and equipment;
• A temporary 2-year increase in Medicaid funding to incentivize the 12 states that have yet to expand Medicaid coverage to do so, which would be paid for by removal of a cap, effective in 2024, on Medicaid inflation rebates for brand drugs;
• 100% subsidization of COBRA coverage, through September, for laid-off workers;
• Expansion of Affordable Care Act (ACA) premium tax credits to 400% of the federal poverty level (FPL), elimination of premiums for individuals at 150% of FPL, and allowance of individuals who receive unemployment compensation in 2021 to qualify for reduced cost-sharing;
• A directive to CMS to recalculate the annual Medicaid Disproportionate Share Hospital (DSH) payments to address an unintended consequence of the temporary increase in FMAP and DSH spending during the COVID-19 public health emergency (the recalculation would ensure that total DSH payments a state may make in a fiscal year are equal to the total payments it could have made absent the FMAP pandemic increase); and
• $5 million for the HHS OIG to oversee the disbursement and use of COVID-19 funds.

The Senate-passed American Rescue Plan Act did not include an extension of the Medicare sequester cuts beyond March 31, 2021. Stakeholders are pressing for Congress to address this issue before the current moratorium expires.