On April 15, 2021, 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, beginning on April 21 (the date the PHE was previously scheduled to expire) and extending through July 19, 2021. This renewal is consistent with the Administration’s announcement that the PHE will likely continue through at least the end of calendar year 2021, as described below. However, the Administration retains the ability to terminate certain flexibilities on an ad hoc basis, even while leaving the PHE declaration in place.
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.
HHS declared COVID‑19 to be a public health emergency effective January 27, 2020. This PHE declaration activated certain emergency authorities under Section 319 of the Public Health Service Act, and HHS has since issued several interim final rules that link certain flexibilities and mandates to the PHE timeline. Congress’s COVID-19 relief legislation has similarly tied various Medicare and Medicaid provisions to the PHE.
PHE declarations expire automatically after 90 days, and so HHS has had to issue periodic declarations renewing the PHE for COVID‑19. In the early months of the pandemic, HHS typically waited until mere days before the PHE’s expiration date before issuing a renewal, a practice that raised questions and concerns about the possibility of stakeholders needing to rapidly unwind dozens of crucial flexibilities.
On January 22, 2021, however, the Acting HHS Secretary sent a letter to governors advising that “the PHE will likely remain in place for the entirety of 2021, and when a decision is made to terminate the declaration or let it expire, HHS will provide states with 60 days’ notice prior to termination.” The letter acknowledged the importance of “predictability and stability” for states’ emergency planning efforts, and also told governors to “expect the continued use of other emergency authorities” that are not expressly linked to the PHE declaration, as described below.
Emergency Measures That Are Linked to the PHE
- Certain Measures Under COVID-19 Response Legislation. Congress has passed several large legislative packages with COVID-related provisions, of which three contain significant regulatory flexibilities and funding that are linked to the PHE: the Families First Coronavirus Response Act (FFCRA), enacted on March 18, 2020; the Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted on March 27, 2020; and the American Rescue Plan Act, enacted March 11, 2021 (Manatt has previously issued summaries of the FFCRA, the CARES Act and The American Rescue Plan.)
- The PHE-linked measures that are particularly relevant for health care providers include enhanced coverage and waived cost sharing for COVID-19 tests, treatments and vaccines across payors; increased Medicare reimbursement for COVID-19-related hospital discharges; and loosened restrictions related to post-acute care facilities. Some of these measures expire at the end of the PHE while others extend for a specified duration past the end of the PHE (e.g., until the end of the calendar quarter in which the PHE ends, or one year plus one calendar quarter after the end of the PHE).
- With respect to Medicaid, FFCRA’s 6.2 percentage point boost to the federal Medicaid match rate remains in effect through the end of the calendar quarter in which the PHE expires. This enhanced federal match is contingent on states complying with a “maintenance of effort” requirement that prohibits restrictive new eligibility measures. Meanwhile, the so-called “continuous coverage” requirement—which prohibits state Medicaid agencies from disenrolling any beneficiaries—lasts until the end of the month in which the PHE expires.
- During the PHE, states have the option of providing coverage for uninsured individuals with respect to COVID-19 testing and (under the American Rescue Plan) vaccinations and treatments.1
- CMS Interim Final Rules with Comment Period (IFCs). The Centers for Medicare & Medicaid Services (CMS) has issued a number of IFCs, effective March 31, May 8, September 2 and November 2, 2020. Most of the IFCs’ regulatory changes are temporary and will expire at the end of the PHE. Early rules modified numerous Medicare and Medicaid rules regarding, for example, Medicare coverage of telehealth, Medicare and Medicaid diagnostic testing, and provider-based hospital departments. The September 2nd IFC introduced a number of new requirements regarding COVID testing and reporting, particularly with respect to long-term care facilities. The November 2nd IFC created enhanced Medicare payments to hospitals for certain COVID‑19 treatments, imposed price transparency requirements for COVID‑19 diagnostic tests, and clarified CMS’s interpretation of the Medicaid “continuous coverage” requirement (see above).
- 1135 Waivers. Section 1135 of the Social Security Act authorizes HHS to modify certain federal health care 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 CMS have issued dozens of nationwide “blanket” waivers and state-specific Medicaid waivers that, among other things, enhance providers’ ability to establish alternative sites of care or practice across state lines, expand Medicare telehealth coverage, and suspend many federal oversight and reporting requirements.
- These waivers expire automatically at the end of the PHE. In addition, certain types of waivers will expire if the President terminates all COVID-related declarations under both the National Emergencies Act (NEA) and the Stafford Act, even if the PHE remains in effect. As of the time of writing, the President’s NEA declaration remains in effect (per a February 24, 2021 renewal declaration), as do several declarations under the Stafford Act (described below).
- In an April 8, 2021 update to the blanket waiver document, CMS announced the termination of certain waivers regarding nursing home Conditions of Participation under the Medicare and Medicaid programs. These waivers suspended certain timelines regarding care plans, as well as certain requirements for notice before a facility resident is discharged, transferred or moved to a different room, or experiences a change in roommate. CMS plans to begin enforcing these requirements effective May 5, 2021. This serves as a reminder that CMS may modify or terminate individual flexibilities at any time, even if the PHE remains in effect.
- 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 program and Children’s Health Insurance Program (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
- HIPAA Enforcement Discretion. The HHS Office of Civil Rights (OCR) has issued guidance relaxing certain federal HIPAA privacy and security rules during the PHE, including with respect to permissible telehealth technologies, community-based testing sites and web-based scheduling of COVID-19 vaccine appointments. (See Manatt’s analysis here and here reviewing some of these HIPAA changes.)
- Fraud & Abuse Enforcement Discretion. The HHS Office of Inspector General (OIG) has issued guidance condoning, for the duration of the PHE, certain COVID response activities that might otherwise raise concerns under the Anti-Kickback Statute or the Physician Self-Referral Law (commonly referred to as the “Stark Law”). (Note that CMS has also suspended several Stark Law restrictions using 1135 waivers, as described above.)
- Flexibility Regarding Controlled Substances. The U.S. Drug Enforcement Administration (DEA) and the HHS Substance Abuse and Mental Health Services Administration (SAMHSA) have issued guidance allowing various flexibilities for Opioid Treatment Programs (OTPs) and other prescribers of controlled substances during the PHE, including with respect to “take-home” doses and telehealth-based assessments and counseling.
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, 2020, 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). In the context of a public health emergency, 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. Notably, the “public health emergency” determination for purposes of issuing EUAs is distinct from the more general PHE declaration under the Public Health Service Act, as discussed above. With respect to COVID-19, HHS deemed that a qualifying public health emergency existed as of February 4.
- Certain Measures Under the COVID-19 Response Legislation. Since the pandemic began, Congress has enacted several important policy changes that will remain in place after the PHE expires, as well as certain temporary measures that are not linked to the PHE itself. Relevant measures appear in the FFCRA, the CARES Act and the American Rescue Plan, as well as the Paycheck Protection Program and Health Care Enhancement Act, enacted April 24, 2020, and the December omnibus spending bill (titled the Consolidated Appropriations Act, 2021 (CAA), enacted December 27, 2020). Notable examples include:
- Several key reforms in the American Rescue Plan (see Manatt’s analysis), including:
- Measures to temporarily increase the affordability of commercial health coverage purchased on the Marketplace or under COBRA’s continuation of employer-sponsored coverage following the end of employment;
- A time-limited financial incentive for states that newly adopt Medicaid expansion under the Affordable Care Act; and
- A new option for states to extend the duration of postpartum coverage under Medicaid and CHIP.
- Several key reforms in the CAA, including the prohibition on “surprise billing”; updates to the mental health coverage parity requirements; various changes to Medicare coverage, reimbursement and drug pricing; and various Medicaid coverage and related policy changes, including delays in scheduled reductions to the allotment of Disproportionate Share Hospital payments and in the reporting requirements related to supplemental payments.
- Disbursements through the Paycheck Protection Program (PPP).
- 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 drugs, devices and biological products used to diagnose, treat or prevent COVID-19. HHS has, in addition, used the PREP Act to pre-empt certain state laws on licensure and scope of practice, including an authorization for most types of health care practitioners nationwide to order and/or administer COVID-19 vaccines under certain circumstances (see Manatt’s analysis). HHS’s PREP Act declarations and related guidance are available here. The PREP Act declaration is currently scheduled to expire in October 2024 unless terminated earlier.
HHS Expects to Continue Renewing the PHE, but Not Necessarily All PHE-Linked Flexibilities
HHS intends to continue renewing the PHE through the end of 2021, as noted above. Congress and the Administration may seek to preserve certain temporary policies on a permanent basis after the PHE expires. Meanwhile, HHS continues to issue new flexibilities in certain areas (such as by expanding the PREP Act authorizations regarding COVID‑19 vaccines), while walking back other flexibilities that—in HHS’s view—are no longer needed (such as the termination of certain 1135 waivers regarding nursing home requirements).
Stakeholders are thus advised to continue monitoring for updates concerning all COVID-related flexibilities.
1 Although federal funding for the optional eligibility group ends at the end of the PHE, states may need to keep this group enrolled (without coverage) until the end of the month in which the PHE period ends in order to comply with FFCRA’s continuous coverage requirement, as explained in CMS guidance.
2 See here for a chart summarizing the expiration timelines for various federal flexibilities concerning Medicaid and CHIP. This chart was developed with support from the State Health and Value Strategies (SHVS) program, a grantee of the Robert Wood Johnson Foundation.