On July 27, 2020, Senate Republicans released their plan for the next phase of coronavirus relief. Instead of a single bill, the Senate plan (dubbed the Health, Economic Assistance, Liability Protection, and Schools Act, or HEALS Act) consists of several individual bills. The Senate package includes the following individual bills: a $306 billion emergency appropriations bill; the CARES 2.0 Act; the Supporting America’s Restaurant Workers Act; the Safely Back to School and Back to Work Act; the SAFE TO WORK Act; the TRUST Act; and the Continuing Small Business Recovery and Paycheck Protection Program Act. Negotiations between the Senate, House, and White House remain ongoing, and there is no clear resolution as to whether any or all of the provisions in the Senate’s plan will be part of the package that is ultimately agreed upon.
Appropriations and Medicare Funding
The package provides emergency funding for HHS and for various HHS programs, including:
- $33 billion in Public Health and Social Services Emergency Funds, with $25 billion to reimburse eligible health care providers for expenses or lost revenues attributable to coronavirus and $8 billion to be transferred to the Health Resources and Services Administration for Primary Health Care for grants under the Health Centers Program, including funding hospital staffing and capital improvements as necessary to meet coronavirus needs;
- an additional $16 billion for testing, PPE, test development, and scaling up of laboratories;
- $3.4 billion to the CDC; and
- $150 million to CMS to support resident and employee safety in skilled nursing and nursing facilities, including activities to support clinical care, infection control and staffing.
The HEALS Act also includes several Medicare changes designed to maintain affordability and accelerate payments to participating providers. The HEALS Act delays the date on which providers are obligated to repay Medicare Accelerated and Advance Payment Program loans until January 1, 2021 and provides additional time until these loans must be repaid in full prior to the recipients having to pay interest. The Senate Finance Committee’s CARES 2.0 Act also includes provisions protecting beneficiaries from anticipated spikes in Part B premiums resulting from COVID-19 by maintaining 2021 premiums at 2020 levels.
The SAFE TO WORK ACT (the Safe to Work Act) limits liability for claims of COVID-19 exposure by creating an exclusive federal cause of action, and by limiting liability in such actions to cases in which the plaintiff can prove by clear and convincing evidence that: (1) the defendant was not making reasonable efforts to comply with applicable government standards and guidance in effect at the relevant time; (2) the COVID-19 exposure was caused by the defendant’s gross negligence or willful misconduct; and (3) the actual exposure to the coronavirus cause the plaintiff’s injury. The Safe to Work Act also establishes a rebuttable presumption that the defendant was making reasonable efforts to comply if it had in place written policies compliant with or more protective than applicable government standards and guidance, which can be rebutted if the plaintiff establishes that the defendant was not complying with its own written policies. The Safe to Work Act also provides that a change in the written policies shall not be used as evidence of liability, and that a defendant cannot be held liable for the acts of a third-party unless it that third party was the defendant’s agent or the defendant had a common law duty to control the acts or omissions of that third party. Finally, the Safe to Work Act imposes a 1-year statute of limitations for claims alleging injury resulting from a coronavirus exposure.
The Safe to Work Act also contains separate liability limitations provisions specifically applicable to health care providers. These limit liability absent proof by clear and convincing evidence of gross negligence or willful misconduct and that the alleged harm was directly caused by the gross negligence or willful misconduct. Moreover, acts, omissions, or decisions resulting from a resource or staffing shortage shall not be considered willful misconduct or gross negligence. For health care providers, the Safe to Work Act specifies that the 1-year statute of limitations will apply absent proof of fraud, intentional concealment, or the presence of a foreign body in the injured person.
Both the general liability limitations and those applicable specifically to health care providers are applicable to currently pending actions, and the Safe to Work Act provides that actions already pending may be removed by the defendant to federal court within 30 days of enactment. The Safe to Work Act also abrogates joint and several liability by providing that each defendant is liable solely for the portion of the judgment corresponding to its proportionate responsibility, and requiring the trier of fact to determine the percentage of total fault of all individuals or entities, including the plaintiff, that contributed to the plaintiff’s loss. A defendant’s liability may be joint and several only where the defendant is determined to have acted with specific intent to injure the plaintiff or knowingly committed fraud.
The Safe to Work Act limits damages to compensatory damages for economic losses incurred by the plaintiff, except in cases of willful misconduct, and where punitive damages are awarded, they may not exceed the amount of compensatory damages. The Safe Work Act also abrogates the collateral source rule by reducing an award of damages by the amount plaintiff has received in compensation for his or her injury from other sources, such as insurance or government programs.
In addition to the substantive liability limitations, the Safe to Work Act contains several procedural limitations on COVID-19 related actions. The Safe to Work Act requires the filing of a separate statement with the complaint with “specific information” as to the nature and amount of each element of damages alleged and the factual basis for the plaintiff’s calculation. The complaint must include a verification by the plaintiff under oath stating that the facts alleged are true to the best of his or her knowledge and specifically identifying the matters alleged on information and belief, an affidavit by a physician or other qualified medical expert that did not treat the plaintiff that the plaintiff suffered the harm alleged in the complaint, and certified medical records documenting the alleged harm.
The Safe to Work Act also prohibits discovery before the time has expired for the defendant to answer or file a motion to dismiss, and if a motion to dismiss is filed, before a ruling on that motion. The Safe to Work Act provides appellate jurisdiction for interlocutory appeals from denials of motions to dismiss, and imposes a discovery stay while the interlocutory appeals are pending. Discovery will be permitted only “with respect to matters directly related to material issues contested” in the case, and a court may compel responses only after a finding that the requesting party needs the information sought to prove or defend as to a material contested issue, and the likely benefits equal or exceed the burden or cost of providing the requested response.
For class actions, classes are limited to those affirmatively electing to be a member of the class and directs the court to provide notice of the action to each class member.
Under the Safe to Work Act, prospective defendants would also have a cause of action for damages and declaratory relief against any person who transmits a demand for settlement of a meritless COVID-19 related claim to that defendant.
The HEALS Act also extends the Medicare telehealth waivers so that the waivers will remain in effect for the entirety of the COVID-19 public health emergency, or December 31, 2021, whichever is later. For federally qualified health centers and rural health clinics, the telehealth waivers extended as part of the CARES Act are extended for 5 years beyond the end of the COVID-19 emergency.
The CARES 2.0 Act creates federal “strike teams” for nursing facilities participating in Medicare and Medicaid, which may include assessment, testing, and clinical teams in order to assist facilities with infection control practices. The CARES 2.0 Act requires HHS to provide the governors of each state with a list of all nursing facilities in which COVID-19 cases increased during the previous week, and to develop training courses for nursing facilities, survey agencies and other individuals. The plan also authorizes HHS to work with the Elder Justice Coordinating Council to promote testing and infection control in nursing facilities.
The Safely Back to School and Back to Work Act requires HHS to establish policies for public and private entities to access infectious disease specimens in order to support the development of tests. The Safely Back to School and Back to Work Act also clarifies that the CDC can enter into agreements with public and private entities for the development and deployment of diagnostic tests for purposes of testing and contact tracing or other public health response activities.
Click here for the appropriations bill, here for the CARES Act 2.0, here for the SAFE TO WORK Act, here for Supporting America’s Restaurant Workers’ Act, here for the Safely Back to School and Back to Work Act, here for the TRUST Act, and here for the Continuing Small Business Recovery and Paycheck Protection Program Act.