HHS Renews COVID-19 Public Health Emergency, Extending Flexibilities and Funding for Another 90 Days

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On Thursday, July 23, the U.S. Department of Health & Human Services (HHS) announced that the Public Health Emergency (PHE) declaration for COVID-19 will be renewed for another 90 days through October 22. This update enumerates the key regulatory flexibilities and funding sources that are linked to the PHE, as well as key emergency measures with independent timelines that are not directly affected by the PHE renewal.

Background

Section 319 of the Public Health Service Act (PHSA) authorizes HHS to declare a PHE in response to events such as “significant outbreaks of infectious diseases or bioterrorist attacks.” A PHE declaration automatically expires after 90 days unless HHS chooses to renew it. The PHSA authorizes certain emergency functions for HHS during a declared PHE, such as making grants or entering into contracts to investigate the cause, treatment and prevention of the relevant disease.

HHS declared a PHE in response to COVID-19 effective January 27, 2020 and has since renewed it twice, extending the PHE’s end date from April 25 to July 24, and now October 22. These expiration and renewal timelines are closely watched by the healthcare industry and state governments because dozens of COVID-19-related emergency measures are scheduled to sunset when the PHE expires. The following sections review key regulatory flexibilities and emergency funding sources that are—and are not—linked to the PHE.

Emergency Measures That Are Linked to the PHE

  • 1135 Waivers. Section 1135 of the Social Security Act authorizes HHS to modify certain federal healthcare requirements during an emergency to ensure sufficient access to services for Medicare and Medicaid beneficiaries, and to protect providers against penalties for good faith attempts to deliver services in emergency conditions. (See here for Manatt’s primer on the 1135 authority.) HHS and the Centers for Medicare & Medicaid Services (CMS) have issued 1135 waivers that relax numerous requirements for healthcare providers (via nationwide “blanket” waivers) and state Medicaid programs (via state-specific waiver approvals), including by enhancing providers’ ability to establish alternative sites of care or practice across state lines, expanding Medicare telehealth coverage, and suspending many federal administrative requirements for providers.
    • In general, these waivers may remain in effect for only so long as there exist both (1) a PHE declared by HHS and (2) a Presidential declaration under either the National Emergencies Act (NEA) or the Stafford Act. Both conditions were satisfied effective March 1, per the President’s NEA declaration. As of the time of writing, the NEA declaration remains in effect, as do several declarations under the Stafford Act (described below).
    • Waivers that impact Medicare telehealth coverage last until the end of the PHE whether or not a qualifying Presidential declaration remains in effect, pursuant to amendments made in the Coronavirus Preparedness and Response Supplemental Appropriations Act that Congress passed on March 6, 2020.
  • CMS Interim Final Rules (IFRs). CMS issued IFRs effective March 31 and May 8, 2020, that modify numerous Medicare and Medicaid rules, including with respect to Medicare-covered telehealth services, supervision of medical residents, Medicare and Medicaid diagnostic testing, provider-based hospital departments, “under arrangements” services, and the Medicare Shared Savings Program (MSSP). Most of the IFRs’ regulatory changes are temporary and will expire at the end of the PHE. (Manatt’s coverage of the March 31 IFR is available here.)
  • Certain Measures Under the COVID-19 Response Legislation. The Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act each enacted numerous flexibilities and funding sources, many of which are linked to the PHE. (Manatt has previously issued summaries of both FFCRA and the CARES Act.)
    • The PHE-linked measures that are particularly relevant for healthcare providers include enhanced coverage and waived cost sharing for COVID-19 testing across payors, increased Medicare reimbursement for COVID-19-related hospital discharges, and loosened restrictions related to post-acute care facilities. In addition, HHS’s Provider Relief Fund FAQs suggest that fund disbursements may ultimately be reconciled by looking back at each provider’s “cumulative lost revenues and increased costs that are attributable to coronavirus during the COVID-19 Public Health Emergency.” 1
    • With respect to Medicaid, FFCRA’s 6.2% boost to the federal Medicaid match rate remains in effect through December 31, 2020 (the end of the calendar quarter in which the PHE expires), as does the “maintenance of effort” requirement that prohibits restrictive new eligibility measures. The “continuous coverage” requirement, which prohibits state Medicaid agencies from disenrolling any individual, lasts until the end of the month in which the PHE expires.
    • The optional Medicaid eligibility group that states may adopt to expand coverage for testing and testing-related services to uninsured individuals (without regard to income) terminates at the end of the PHE.
  • Certain State Medicaid and CHIP Operational Flexibilities. In response to COVID-19, CMS has allowed states to rapidly implement various time-limited changes to their Medicaid programs and Children’s Health Insurance Programs (CHIP). Many of these changes will expire at the end of the PHE or shortly thereafter, including program modifications implemented via a Disaster Relief State Plan Amendment (SPA) or COVID-19 1115 demonstration project.2

Emergency Measures That Are Not Linked to the PHE

  • The President’s Stafford Act Declarations. These declarations authorize the Federal Emergency Management Agency (FEMA) to disburse disaster relief funds. In addition to a nationwide emergency declaration on March 13, the President has issued state-by-state major disaster declarations. These declarations all remain in effect as of the time of writing. FEMA will eventually declare an end to the “incident period” related to COVID-19, which will establish the time period during which certain types of expenses will be reimbursed.
  • Emergency Use Authorizations (EUAs). Under Section 564 of the Federal Food, Drug and Cosmetic (FD&C) Act, the U.S. Food & Drug Administration (FDA) may issue EUAs that temporarily authorize unapproved medical products. EUAs may be granted in response to a Public Health Emergency that, as determined by HHS, has significant potential to affect national security or the health and security of United States citizens living abroad. With respect to COVID-19, HHS deemed that a qualifying Public Health Emergency existed as of February 4, a determination that appeared to be separate from HHS’s January 27 PHE declaration under the PHSA.
  • Certain Measures Under the COVID-19 Response Legislation. Certain measures in FFCRA and the CARES Act are not expressly linked to the PHE, including disbursements through the Paycheck Protection Program (PPP) and permanent changes to the “Part 2” rules that govern the confidentiality of information held by certain substance use disorder (SUD) programs. It is possible, however, that the PHE could factor into implementation and audit protocols with respect to these programs. (See Manatt’s webinar discussing lessons learned regarding the PPP and summary of the altered SUD confidentiality standards.)
  • The HHS Public Readiness and Emergency Preparedness (PREP) Act. HHS’s PREP Act declaration, which went into effect February 4, shields certain individuals and entities from liability with respect to the manufacture, distribution, administration or use of certain “medical countermeasures,” defined in an advisory opinion as FDA-authorized drugs, devices and biological products used to diagnose, treat or prevent COVID-19. This liability does not extend to willful misconduct. HHS has, in addition, authorized pharmacists in all states to order and administer COVID-19 tests, notwithstanding any limitations that may exist under state laws on scope of practice. HHS’s PREP Act declaration is currently scheduled to expire in October 2024 unless terminated earlier.

A chart summarizing this information, including the current end dates of these flexibilities, is available through Insights@ManattHealth—a premium subscription service designed to help healthcare stakeholders keep up with the latest developments and benefit from in-depth analyses critical to their business. The content leverages Manatt Health’s legal and policy expertise in the Medicaid, Medicare, Marketplace, life sciences, litigation, digital health and privacy spaces and includes:

  • Manatt’s weekly memo, “Insights This Week”: a roundup of the week’s federal and state policy changes
  • Regulatory and guidance summaries: detailed summaries of Medicaid, Medicare and Marketplace regulatory and subregulatory guidance, as well as synopses of healthcare litigation developments
  • 50-state surveys: deep dives of the latest trends in healthcare, including 1115 coverage waivers, 340B policies and telehealth

1 The FAQs also state the following: “If, at the conclusion of the pandemic, providers have leftover Provider Relief Fund money that they cannot expend on permissible expenses or losses, then they will return this money to HHS.” (See here for Manatt’s discussion of other potential areas of liability concerning the Provider Relief Fund.)

2 Medicaid Disaster Relief SPAs expire at the end of the PHE. CHIP Disaster Relief SPAs may continue past the end of the federal PHE if a qualifying state emergency declaration remains in place. COVID-19 1115 demonstration projects terminate, at the latest, 60 days following the end of the PHE. For more detail on these and other emergency timelines concerning Medicaid and CHIP, see Federal Declarations and Flexibilities Supporting Medicaid and CHIP COVID-19 Response Efforts: Effective and Expiration Dates, a product developed by Manatt with support from the State Health and Value Strategies (SHVS) program, a grantee of the Robert Wood Johnson Foundation.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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