Coronavirus Flash Update May 26, 2020

Coronavirus Flash Update: May 26, 2020

Alston & Bird’s Coronavirus Flash provides updates on policy and regulatory actions under consideration across many important industries being monitored by our teams. Links to key government and legal resources are provided throughout the report.

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UPDATED 9:00 AM ET ON TUESDAY, MAY 26, 2020

Note to Flash readers: Due to Memorial Day on Monday, May 25, the next Flash will be Friday, May 29. It will be back to its regular schedule the first week of June.


The Latest News

  • U.S. COVID-19 cases exceed 1,655,625 and 97,212 U.S. deaths. (Source: CDC) (Updated 5/25/20)
  • U.S. stock market: On Friday the U.S. benchmarks posted mixed results, with the Dow dropping slightly at 8 points, and the S&P 500 and Nasdaq posting small gains at 6 and 39 points, respectively. (New)
  • On Sunday, President Trump released an order restricting nearly all travel from Brazil for non-U.S. citizens if they were in the country during the prior 14-day period. Green card holders, close relatives of U.S. citizens, and flight crew members are exempt. The order notes that the Centers for Disease Control and Prevention has determined that Brazil is experiencing “widespread, ongoing person-to-person transmission” of COVID-19. (New)
  • Late Friday, the Small Business Administration, jointly with the Department of Treasury, released the interim final rule for the PPP loan forgiveness process. The SBA also released the interim final rule the PPP loan review procedures and borrowing responsibilities. (New)
  • The Department of Health and Human Services (HHS) released a report to Congress on its COVID-19 Strategic Testing Plan on Sunday, as required by the Paycheck Protection Program and Health Care Enhancement Act. The report outlines 3 primary purposes for active testing: diagnostic testing, testing for contact tracing, and surveillance testing. The report was immediately criticized by congressional Democratic leaders as being light on data and results. (New)
  • On Friday, the HHS released a statement extending the Provider Relief Fund attestation deadline for an additional 45 days. This allows providers 90 days from the date they received a payment to accept the Terms and Conditions or return the funds. (New)

COVID-19 Federal & State Legislation  

  • Bill 4.0: Congress is not expected to move forward during this short work week on the 4.0 emergency stimulus bill, but both bodies may consider legislation to provide more flexibility for small businesses through the Paycheck Protection Program (PPP). In the Senate, separate bills were introduced last week by Senators Marco Rubio (R-FL) and Ben Carper (D-MD), and by Senators Angus King (I-ME) and Steve Daines (R-MT), to extend the time businesses have to use PPP funds. The House is scheduled to vote under suspension of the rules on Wednesday on a bill sponsored by Representatives Dean Phillips (D-MN), which is very similar to bill (HR 6886) sponsored by Rep. Chip Roy (R-TX) to enhance the provisions for PPP loan forgiveness and to defer payroll taxes. These House bills are nearly identical to the bill sponsored by Senators King and Daines. (New)
  • For the full details on the HEROES Act, H.R. 6800, which passed the House on May 15:
  • Bill 3.5: Paycheck Protection Program and Health Care Enhancement Act, (R. 266) was enacted on April 24. Also available are a section-by-section summary and an overview of the health care provisions.
  • A&B detailed summaries are below:
    • A&B Summary – 5 Small Business Provisions
    • A&B Summary – 5 Health Care Enhancement Provisions
  • Bill 3.0: Coronavirus Aid, Relief, and Economic Security (CARES) Act, (R. 748) passed on March 27. A congressional section by section summary is available here.
  • A&B detailed summaries are below:
  • Congress has passed three coronavirus emergency response bills and the first two are below:
  • Bill 1.0: Coronavirus Preparedness and Response Supplemental (CPPRS) (R. 6074) passed on March 5
  • Bill 2.0: Families First Coronavirus Response Act (FFCRA) (R. 6201) passed on March 18

Transition to “Reopening”  

  • State/Other Actions
    • For the latest information on state reopening decisions, see A&B 50-State Openings tracker - updated in each A&B Coronavirus Flash. (Updated 5/22/20)
  • Administration Actions

Federal Communications Commission  

  • The FCC approved an additional 43 funding applications for the COVID-19 Telehealth Program, totaling $16.78 million. (5/20/20)
  • The FCC and FTC sent warning letters to gateway providers for allegedly allowing COVID-19 pandemic-related scam robocalls into the United States. The agencies warned these companies to cut off this traffic or face serious consequences. (5/20/20)

Department of Health and Human Services  

  • The Department of Health and Human Services (HHS) Coronavirus toolkit page has been updated. (Updated 5/22/20)
  • HHS Biomedical Advanced Research and Development Authority (BARDA) announced an agreement with AstraZeneca to accelerate the development and manufacturing of the company’s investigational vaccine. The agreement is part of Operation Warp Speed. (5/21/20)
  • HHS announced a partnership with several pharmaceutical companies—including Phlow Corporation, AMPAC Fine Chemicals, Civica Rx, and the Medicines for All Institute at the Virginia Commonwealth University—to expand capabilities to manufacture active pharmaceutical ingredients and chemical compounds to make critical medicines. (5/19/20)
  • HHS announced $11 billion in funding under the Paycheck Protection Program and Health Care Enhancement Act for COVID-19 testing. The funding will be provided through the CDC and Indian Health Service to states, territories, and tribes. A list of funding recipients is available here. (5/18/20)
  • The HHS Office of the Assistant Secretary for Preparedness and Response (ASPR) has created a new online section detailing medical countermeasures under investigation by the Agency. (5/22/20) (New)
  • ASPR has a webpage detailing information on the remdesivir allocation process. (5/21/20)
  • ASPR released a Healthcare Facility Onboarding Checklist for hospitals and other facilities to use in streamlining staff acquisition and the onboarding process in times of need. (5/20/20)
  • ASPR also issued a request for information seeking industry input on the proposed strategy and structure of the strategic national stockpile. Responses are due by May 29. (5/15/20)
  • HHS has a tracking feature that allows public viewing of all COVID-19 HHS grants and cooperative agreement awards on its website. The grants were distributed through programs in the ACF, ACL, ASPR, CDC, DHHS/OS, HRSA, IHS, NIH, and SAMHSA. (Updated 5/21/20)

Centers for Disease Control and Prevention  

  • The Centers for Disease Control and Prevention (CDC) COVIDView Weekly Summary is available. (Updated 5/22/20)
  • The CDC weekly COVID forecast. (Updated 5/21/20)
  • The CDC S. testing data. (5/25/20) (New)
  • The CDC updated its information on serology testing for COVID-19 at CDC. (Updated 5/23/20)
  • The CDC updated its information on contact tracing and case investigation. (Updated 5/20/20)
  • The CDC released a new resource with ASPR on COVID-19 Pandemic Planning Scenarios, designed to help inform decisions by mathematical modelers and public health officials who use modeling. Models developed using the data provided in the planning scenarios can help evaluate the potential effects of different community mitigation strategies. (5/20/20)
  • The CDC created a website compiling publications about COVID-19 for laboratories. (5/20/20)
    • The CDC also updated its FAQs for laboratories. (Updated 5/20/20)
  • The CDC updated its considerations for inpatient obstetric healthcare settings. (Updated 5/20/20)
  • The CDC updated its guidance for pediatric health care providers to address current information on multisystem inflammatory syndrome in children. (Updated 5/20/20)

Centers for Medicare & Medicaid Services  

  • The Centers for Medicare and Medicaid Services (CMS) latest news alerts. (Updated 5/22/20)
  • And for the latest COVID-19 related CMS guidance and FAQs visit the CMS Current Emergencies webpage. (Updated 5/18/20)
  • CMS updated its guidance on billing codes for COVID-19 testing. The guidance lists the payment amount for COVID-19 testing by each Medicare Administrative Contractor (MAC). (Updated 5/19/20)
  • CMS updated its list of blanket waivers with language modifying physical environment waivers to allow greater flexibilities for surge capacity and to modify the data collection and reporting period for ground ambulance organizations. (Updated 5/19/20)
  • For a better understanding of the COVID-19 telehealth waivers and regulatory flexibilities, review this new A&B Guide. (5/12/20)

HHS/CMS/HRSA CARES Act Provider Relief Funds  

  • HHS released a statement extending the Provider Relief Fund attestation deadline for an additional 45 days. This allows providers 90 days from the date they received a payment to accept the Terms and Conditions or return the funds. (5/22/20) (New)
  • HHS announced, jointly with the Indian Health Service, $500 million in payments to tribal hospitals, clinics and urban health centers. (5/22/20) (New)
  • HHS issued a statement notifying eligible providers that they have until June 3, 2020 to submit their additional revenue information for payments from the Provider Relief Fund $50 billion General Distribution. (5/20/20)
  • HHS announced that it has begun distributing nearly $4.9 billion in additional relief funds to skilled nursing facilities (SNFs) to help them combat the devastating effects of the pandemic. HHS will make relief fund distributions to SNFs based on both a fixed basis and variable basis. All certified SNFs with six or more certified beds are eligible for this targeted distribution. (5/22/20)
  • HHS updated the CARES Act Provider Relief Fund FAQs. (Updated 5/21/20)
  • The CMS Provider Relief Fund webpage has been updated and additional portals opened: (Updated 5/22/20)
  • The CARES Provider Relief Fund hotline is (866) 569-3522.

Food and Drug Administration  

  • FDA provides a daily roundup on COVID-19 related actions. The latest announcements. (Updated 5/22/20)
    • FDA updated its FAQs on Testing for SARS-COV-2, including posting a list of antibody tests that are being removed from the “notification list” of tests being offered. (Updated 5/22/20)
    • FDA maintains its COVID-19 FAQs for the general public. (Updated 5/22/20)
    • The agency also maintains a public database of drug shortages. (Updated 5/22/20)
  • The FDA issued guidance for supplements for approved premarket approval or humanitarian device exemption submissions. (5/21/20)
  • The FDA and U.S. Department of Agriculture announced a memorandum of understanding to help prevent interruptions at FDA-regulated food facilities. (5/19/20)
  • The FDA announced that it had entered into an agreement with Aetion to collaborate on data analysis related to COVID-19 research. (5/19/20)

National Institutes of Health  

  • The National Institutes of Health (NIH) released a statement that the investigational antiviral remdesivir is superior to the standard of care for the treatment of COVID-19, citing data from a report published in the New England Journal of Medicine. (5/22/20) (New)

Health Resources and Services Administration  

  • The Health Resources and Services Administration (HRSA) HRSA, provided $225 million to Rural Health Clinics for COVID-19 testing through the Paycheck Protection Program and Health Care Enhancement Act. (5/20/20)
    • A state-by-state breakdown is available here. (5/20/20)
  • HRSA provides COVID-19-related information, resources, and FAQs here. (Updated 5/17/20)

Department of Homeland Security/FEMA  

  • The Department of Homeland Security (DHS) released a fact sheet explaining the extended measures placed on S. borders to limit the further spread of COVID-19. (5/20/20)
  • The DHS issues a weekly roundup of its response to COVID-19. (Last updated 5/18/20)
  • The DHS Cybersecurity and Infrastructure Security Agency (CISA) updated its guidance on essential critical infrastructure workforce. (Updated 5/19/20)
  • The Federal Emergency Management Agency (FEMA) weekly briefing update. (5/22/20) (New)
  • FEMA provided COVID-19 Pandemic Operational Guidance for the 2020 hurricane season. (5/20/20)
  • FEMA updated its fact sheet on PPE packages for nursing homes. (Updated 5/20/20)
  • FEMA issued a fact sheet on its efforts to expand the supply chain of critical resources. (5/18/20)

Department of Justice/Federal Trade Commission/Litigation  

  • The Department of Justice announced that it charged an individual with fraudulently obtaining $20 million in PPP loans for two companies that had no employees. The defendant allegedly claimed that his companies were helping New York State obtain COVID-19 test kits and personal protective equipment. (5/21/20)
  • DOJ also charged a defendant with fraudulently seeking $5 million in PPP loans from two different banks. (5/19/20)
  • The Federal Trade Commission (FTC) sent warning letters to 50 more marketers nationwide to stop making unsubstantiated claims that their products and therapies can treat or prevent COVID-19. (5/21/20)
  • The FTC and SBA sent warning letters to two companies that may be misleading small businesses seeking SBA loans as a result of COVID-19. One of the companies has claims like “Your Paycheck Protection Program Loan starts here!” while the other claims it is an authorized SBA loan packager for PPP and advertised its services for a $495 fee, despite the SBA prohibiting lead generators or other agents from charging fees to PPP loan applicants. The FTC’s letters warn the companies to take immediate action to ensure all deceptive claims are removed and to remediate any harm to small business consumers as a result of the claims. The recipient companies must also notify the FTC within 48 hours what specific actions they took to address the agency’s concerns. (5/18/20)
  • The FTC has advised nursing homes and assisted living facilities that they cannot take residents’ stimulus payments simply because the resident is on Medicaid. The Iowa Attorney General’s Office and other State AGs have received reports that these facilities have been requiring residents to sign over their stimulus payments against the CARES Act directives. According to the CARES Act, those economic impact payments are considered tax credits which do not constitute “resources” for federal benefits programs, including Medicaid. (5/15/20)
  • The Department of Justice Antitrust Division issued its third expedited business review letter (BRL) related to COVID-19 collaborations, this time in connection with collaboration by pork producers and processors. COVID-19 outbreaks forced many meat plants to close, leading to a reduction in processing capacity. As a result, some hogs are now unmarketable because they have grown too large to fit on processors’ production line equipment. DOJ approved the National Pork Producers Council’s proposal to allow its members to coordinate with each other and the USDA and share information to address these supply chain issues. (5/15/20)

Department of Labor/OSHA  

  • The Department of Labor (DOL) announced publication of a final rule that expands the ability of private sector employers to communicate retirement plan information online or by email. (5/21/20)
  • The Department of Labor announced a final rule that allows employers to pay bonuses or other incentive-based pay to salaried, nonexempt employees whose hours vary from week to week. The final rule clarifies that payments in addition to the fixed salary are compatible with the use of the fluctuating work week method under the Fair Labor Standards Act (FLSA). (5/20/20)
  • The DOL updated its resources for employers, employees, and states to prevent unemployment insurance fraud. (5/19/20)
  • The Occupational Safety and Health Administration (OSHA) announced that it was revising two enforcement policies regarding COVID-19. First, OSHA updated its interim enforcement response plan for COVID-19 to increase in-person inspections at all types of workplaces. Second, OSHA updated its enforcement guidance requiring employers to record work-related coronavirus cases. (5/19/20)
  • OSHA announced that it was making $11.5 million available in grants to non-profits to support training on workplace safety and health hazards. (5/19/20)

Small Business Administration  

  • Small Business Administration (SBA) – In response to the CARES Act requirements, the SBA Paycheck Protection Program (PPP) website for lenders and small business borrowers. (5/23/20)
  • The SBA released the Paycheck Protection Program Loan Forgiveness process, which includes the application and instructions. (5/15/20)
  • The SBA released a procedural notice informing PPP Lenders of the reporting process through which PPP Lenders will report on PPP loans and collect the processing fee on fully disbursed loans which they are eligible to receive. (5/21/20)
  • The SBA updated its total loan statistics, noting that it has approved 4.4 million loans, totaling $512 billion in loans through 5,511 participating lenders. (Updated 5/23/20)
  • The SBA and Treasury updated their FAQs on the Paycheck Protection Program to provide guidance extending the SBA Form 1502 reporting deadline for lenders (question 48). (Updated 5/19/20)
  • The SBA issued a PPP interim final rule, extending the safe harbor deadline to May 18, 2020. (5/20/20)
  • The SBA issued an interim final rule that provides guidance to entities with foreign affiliates regarding PPP loan forgiveness. (5/19/20)

Department of Treasury/IRS/Federal Reserve  

Other Agencies  

  • The S. Department of Agriculture (USDA) announced that it is making available up to $1 billion in loan guarantees to help rural businesses meet their working capital needs during the coronavirus pandemic. (5/21/20)
  • The Consumer Financial Protection Bureau (CFPB) issued two “no-action” letter templates (template) to help homeowners and consumers seeking small dollar loans and wishing to avoid foreclosure in the process. (5/22/20) (New)
  • A&B attorneys provide analysis on how the CFPB is responding to consumer complaints about mortgage and credit card terms during the pandemic. (5/18/20)
  • The Environmental Protection Agency (EPA) issued an additional temporary amendment to Pesticide Registration Notice 98-10 to include food-contact surface sanitizer products containing the active ingredient isopropyl alcohol. This allows manufacturers of food-contact surface sanitizer products containing isopropyl alcohol to use similar sources of this active ingredient without EPA approval. This amendment should increase availability of food-contact surface sanitizers, benefiting facilities processing low moisture products like grains, cereal, flour, and industrial baked goods, which have been experiencing sanitizer shortages. (5/15/20)
  • For information on COVID-19 waste regulation and environmental compliance issues during the pandemic, read the A&B Environmental & Land Use Briefing. (5/22/20) (New)
  • The Federal Housing Finance Agency (FHFA) announced that it is seeking comments on a notice of proposed rulemaking that would establish a new regulatory capital framework for Fannie Mae and Freddie Mac. (5/20/20)
    • FHFA also issued temporary guidance regarding the eligibility of borrowers who are in forbearance, have recently ended their forbearance, are looking to refinance, or buy a new home. (5/19/20)
  • The Department of Housing and Urban Development (HUD) announced a fourth series of CARES Act funding totaling $75 million to assist people living with disabilities. Information on the local impact of the assistance is available here. (5/18/20)
  • The Transportation Security Administration (TSA) announced that it has implemented changes to the security screening process that reduce the potential for cross-contamination at the security checkpoint in an effort to help prevent the spread of COVID-19. (5/21/20)
  • Trade and International Business Issues   COVID-19: global supply chains to expect major reshuffle COVID-19: global supply chains to expect major reshuffle COVID-19: global supply chains to expect major reshuffle COVID-19: global supply chains to expect major reshuffle COVID-19: global supply chains to expect major reshuffle
  • On Sunday, President Trump released an order restricting nearly all travel from Brazil for non-U.S. citizens if they were in the country during the prior 14-day period. Green card holders, close relatives of U.S. citizens, and flight crew members are exempt. (5/24/20) (New)
  • The S.-Canada Border To Remain Closed Through June 21. Canadian Prime Minister Justin Trudeau during his daily press conference commented that “[i]t was the right thing to further extend by 30 days our closure of the Canada, U.S. border to travelers other than essential services and goods, but we will continue to watch carefully what’s happening elsewhere in the world and around us as we make decisions on next steps.”
  • USDA APHIS Allows Electronic Copies of Veterinary Certificates and Phytosanitary Certificates Due to COVID-19 through July 18. The U.S. Department of Agriculture’s Animal and Plant Health Inspection Service has extended the interim guidance for the electronic submission of veterinary health certificates, phytosanitary certificates, and PPQ 203 forms for shipment clearance due to COVID-19 pandemic. The guidance is now effective through July 18, 2020.

Insurance Issues  

  • For a 50-state review of business interruption insurance related issues see this new COVID-19 Insurance Litigation and Regulatory Issues tracker. The tracker is updated weekly. (updated 5/25/20)
  • On May 21, the National Association of Mutual Insurance Companies, jointly with other insurance industry trade associations, announced a proposal for a new federal program to assist businesses in the event of a future pandemic risk. The Business Continuity Protection Program would “provide revenue replacement assistance . . . following a presidential viral emergency declaration.” The program would be administered by the Federal Emergency Management Agency with assistance from private contractors. (New)
  • On May 19, the Organized Dentistry Coalition (the “ODC”) sent a letter to Congress recommending that it support HR 6494, the Business Interruption Insurance Coverage Act, which if passed would require insurers to “make[] available business interruption insurance coverage” for COVID-19 related losses for an increased premium. The ODC noted that many dental practices have “learned that their policies do not cover government-ordered business shutdowns caused by a national emergency” and that the lack of coverage has had a “substantial negative impact” on dental practice owners. However, the ODC acknowledged that “abrogating or re-writing contracts at this time could potentially have a deleterious impact on the property and casualty insurance industry, as current policy premiums did not account for the risk associated with these pandemic-related losses when they were calculated.” (New)
  • On May 15, the Louisiana Senate proposed an Amended Senate Bill 477. The original bill would have retroactively required insurers to provide business interruption coverage for COVID-19 related business income losses, regardless of policy language. The May 15 amended bill nixes the controversial retroactive requirements and instead requires that all policies issued after August 1, 2020 “include a notice of all exclusions on a form prescribed by the commissioner of insurance” which shall “be conclusively presumed to become a part of the policy of contract when issued and delivered.” (New)
  • The pace of new business income coverage claims flooding state and federal courts nationwide has not slowed over the last few weeks. Notable filings and orders include:
  • On May 22, Healthnow Medical Center Inc. filed suit in California state court against its insurer, State Farm General Insurance Company, alleging claims for breach of contract, bad faith, and unjust enrichment.Plaintiff alleges that State Farm wrongfully denied Plaintiff’s claim for lost business income arising out of the COVID-19 related governmental orders and seeks punitive damages. The case is Healthnow Med. Ctr. Ins. v. State Farm General Ins. Co., No. T20-1121 (Santa Clara Cnty. Sup. Ct., Cal.). (New)
  • On May 21, Gervasi 1700 LLC brought suit in Ohio state court against National Trust Insurance Company, Franchise Insurance Agency Inc. dba Leavitt Group Midwest, and Bradley W. Stammler alleging that defendants Stammler and Leavitt group failed to disclose that the policy they procured for Plaintiff from defendant National Trust contained a virus and bacteria exclusion.Plaintiff alleges claims for breach of contract, bad faith and negligence. The case is Gervasi 1700 LLC v. National Trust Ins. Co., et al., No. 2020CV00818 (Stark Cnty. Ct. of C.P., Ohio). (New)

For background and the most up-to-date information, please visit the Centers for Disease Control and Prevention Coronavirus Disease 2019 website: HERE. The additional federal agency links are provided by the White House Coronavirus Task Force:   What You Should Know:

Information for Businesses:

Information for Travel and Transportation:

Information for Healthcare Providers, First Responders, and Research Facilities:

Information for Community Events and Gatherings:

Alston & Bird Coronavirus Links

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