Coronavirus Flash Update June 22, 2020

Coronavirus Flash Update: June 22, 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 MONDAY, JUNE 22, 2020

The Latest News

  • U.S. COVID-19 cases exceed 2,270,405 and 118,117 U.S. deaths. (Source: CDC) (Updated 6/22/20)
  • U.S. stock market: On Friday the markets ended with mixed results for the day, with the Dow down 208 points, the S&P 500 down 17 points, and the Nasdaq up 3 points. Weekend trading in stock futures were pointing to losses as of Sunday night. (New)
  • President Trump has scheduled an event today to make visa changes and is expected to issue an executive order prohibiting the entry into the U.S. of various nonimmigrant workers, including H-1B, H-2B, L-1, and J-1 visa holders. The ban is expected to last 120-180 days and is expected to apply to those currently living abroad. (6/22/20) (New)
  • The Department of Treasury announced jointly with the Small Business Administration a statement that they would release business names and loan range for PPP Loans, as well as demographic and location The announced noted that steps would be taken to protect personally identifiable information responding to initial concerns about proprietary or confidential data on recipients. (6/19/20) (New)
  • After noting that some PPP loan applicants could not find lenders, the SBA has launched a Lender Match tool to aid small businesses and non-profits to be matched with Community Development Financial Institutions (CDFIs), Minority Depository Institutions (MDIs), Certified Development Companies (CDCs) Farm Credit System lenders, microlenders, and traditional smaller asset size lenders. (6/19/20) (New)

COVID-19 Federal & State Legislation   

  • Bill 4.0: Last Thursday, the House Democratic leadership announced a $1.5 trillion infrastructure plan which outlines investments in bridges, water systems, roads, and other infrastructure. The House Ways and Means Committee released a fact sheet summarizing the details of the proposal which includes tax code changes to permanently reinstate Build America Bonds and Advance Refunding Bonds, and the expansion of the issuance of Private Activity Bonds. A vote may be scheduled for the week of July 6. (New)
  • The HEROES Act was the first formal offer on a new emergency stimulus bill, 4.0: For the full details on the HEROES Act, H.R. 6800, which passed the House on May 15:
  • The Paycheck Protection Flexibility Act, H.R. 7010, was enacted on June 5. To learn more, see this A&B Summary of the Paycheck Protection Flexibility Act. (6/5/20)
  • 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”   

Department of Health and Human Services   

  • The Department of Health and Human Services (HHS) Coronavirus toolkit page has been updated. (Updated 6/17/20)
  • 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 6/18/20)
  • The HHS Assistant Secretary for Preparedness and Response released guidance on considerations for resumption of services for health care facilities. (6/19/20) (New)
  • The HHS Office of Biomedical Advanced Research and Development Authority (BARDA) has announced a new partnership with Empatica to develop and seek FDA’s EUA for Aura, a wearable system and algorithm seeking to be used as an early warning platform for COVID-19 infection. (6/19/20) (New)
  • BARDA has announced a partnership with the DoD JPEO-CBRN and Corning Incorporated for the rapid expansion of domestic capacity to manufacture high-quality tubing, glass, and cartridges for vaccines. (6/19/20) (New)
  • The HHS Health Resources and Services Administration announced $107.2 million in awards to increase the health workforce in rural and underserved communities. (6/18/20) (New)
  • The National Institutes of Health Director, Francis Collins, MD, posted a blog on a new study addressing how genes and blood type are tied to risk of severe COVID-19. (6/18/20) (New)
  • BARDA has announced a partnership with Ortho Clinical Diagnostics to further the development of two automated antibody tests for COVID-19. (6/17/20)
  • BARDA has announced a partnership with Immunexpress Inc. to determine the risk of sepsis in COVID-19 in hospital emergency departments or ICUs. (6/16/20)
  • HHS has released a fact sheet on Operation Warp Speed, the initiative to find a COVID-19 vaccine by January 2021. (6/16/20)
  • The HHS Administration for Community Living (ACL) has updated its COVID-19 Resources webpage. (Updated 6/16/20)

HHS/CDC/CMS/HRSA CARES Act Provider Relief Funds   

  • HHS has posted a resource on Provider Relief Fund disbursements to serve as summary of the key details. (6/18/20)
  • HHS announced three new Provider Relief Fund allotments completing the initial $100 billion authorized by the CARES Act. The additional $75 billion for the Provider Relief Fund authorized by the Paycheck Protection and Healthcare Enhancement Act remains to be distribution and neither the breakdown nor the disbursement formulas are known. (6/9/20) The three new allotments are:
  • $10 billion for safety net hospitals. HHS has posted the state-by-state breakdown. (6/9/20)
    • HHS has provided additional detail on the Safety Net definitions and data source methodology. (6/16/20)
    • HHS released additional information on the hospital safety net distribution, clarifying that HHS had extracted information from the CMS Hospital Cost Reports and Provider Specific Files to identify acute care facilities and children’s hospitals that met each of the following criteria, respectively: (6/11/20)
      • Acute Care Facilities: A Medicare Disproportionate Patient Percentage of 20.2% or greater; Annual uncompensated care of at least $25,000 per bed; and Net Operating Margin of 3.0% or less.
      • Children’s Hospitals: A Medicare Disproportionate Patient Percentage of 20.2% or greater; Net Operating Margin of 3.0% or less.
    • $10 billion is a second round funding for hot spot hospitals.
    • $15 billion for Medicaid and Children’s Health Insurance Program (CHIP) providers that participate in state Medicaid and CHIP programs and have NOT received a payment from the Provider Relief Fund General Allocation. The Provider Relief Fund Portal is open to allow eligible Medicaid and CHIP providers to report their annual patient revenue, which will be used as a factor in determining their payment. The final amount each provider will receive will be determined after the data is submitted, including information about the number of Medicaid patients providers serve. (Updated 6/19/20)
    • HHS - the CARES Act Provider Relief Fund (PRF) webpage and Portal (Updated 6/17/20)
    • HHS expects to distribute $15 billion to eligible Medicaid and CHIP providers through the Provider Relief Fund. Join the webcast to learn more about the application process. Please pre-register to reserve a spot on your preferred date:
    • And the PRF FAQs (Updated 6/16/20) have been updated and capture numerous modifications.
    • The CDC has posted an updated dataset of provider recipient specific payment from the Provider Relief Fund general distribution high impact targeted allocation and/or rural targeted allocation. The dataset includes who has attested to receiving one or more payments and agreed to the terms and conditions as of June 18. $31.569 million has been paid for testing and $154.975 million has been paid for treatment. (Updated 6/18/20)
    • The COVID-19 Provider Relief Fund – the A&B General Distribution Attestation and Application Process Guide has been updated. (Updated 5/27/20)
    • The CARES Provider Relief Fund hotline is (866) 569-3522.

Centers for Disease Control and Prevention  

Centers for Medicare & Medicaid Services  

  • The Centers for Medicare and Medicaid Services (CMS) latest news alerts.(Updated 6/19/20)
  • And for the latest COVID-19 related CMS guidance and FAQs visit the CMS Current Emergencies webpage. (Updated 6/19/20)
  • CMS announced the membership of the 25 individuals to serve on the independent Coronavirus Commission on Safety and Quality in Nursing Homes. The Commission will seek an independent review and comprehensive assessment of nursing homes’ responses to COVID-19, and a report is due September 1. (6/19/20) (New)
  • CMS announced it has instructed Medicare Administrative Contractors and notified Medicare Advantage plans to cover COVID-19 laboratory tests for nursing home residents and patients. Medicare Advantage plans must continue not to charge cost sharing or apply prior authorization or other utilization management requirements for COVID-19 tests and testing-related services. (6/19/20) (New)
  • CMS has released FAQs on exceptions for dialysis facilities affected by COVID-19. (6/18/20) (New)
  • CMS has updated its Medicare Fee-for-Service billing FAQs. (Updated 6/19/20)
  • CMS has posted a Toolkit on State Actions to Mitigate COVID-19 Prevalence in Nursing Homes. (6/17/20)
  • CMS has updated its 1135 waiver information. (6/16/20)

Food and Drug Administration  

  • FDA provides a daily roundup on COVID-19 related actions. (Updated 6/19/20)
    • 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 6/19/20)
    • FDA FAQs on Asymptomatic testing for COVID-19. (Updated 6/19/20)
    • FDA maintains its COVID-19 FAQs for the general public. (Updated 6/19/20)
    • FDA webpage for health professionals. (Updated 6/19/20)
    • The agency also maintains a public database of drug shortages. (Updated 6/19/20)
    • The FDA has published a new webpage on COVID-19 Educational Resources. (Updated 6/12/20)
  • The FDA advises consumers not to use any hand sanitizer manufactured by Eskbiochem. (6/19/20) (New)
  • The FDA published FAQs on food labeling requirements during COVID-19. (6/18/20) (New)
  • The FDA announced steps to harness real-world data in its response to COVID-19. (6/18/20) (New)
  • The FDA issued warning letters to three companies for fraudulent COVID-19 products: Medakit, Ltd., Antibodiescheck.com and Yama Group, and Dr. Jason Korkus, DDS and Sonrisa Family Dental. (6/17/20) (New)
  • The FDA issued warning letters to three companies marketing adulterated and misbranded COVID-19 antibody tests. (6/17/20)
  • The FDA announced a new process for facilitating diagnostic testing availability for asymptomatic testing and sample pooling by posting a molecular diagnostic template for manufacturers and laboratories. (6/17/20)
  • The FDA has revised its Remdesivir fact sheet for health care providers to warn of potential drug interactions as well as clarifying under what circumstances the unapproved remdesivir is permitted emergency use for COVID-19. (Updated 6/15/20)
  • The FDA revoked emergency use authorization for the Chembio Diagnostic System, Inc. antibody test due to performance concerns with test accuracy. (6/17/20)

Department of Homeland Security/FEMA   

  • The Department of Homeland Security (DHS) posts a weekly update of its response to COVID-19. (Updated 6/15/20)
  • The Federal Emergency Management Administration (FEMA) has cancelled the annual national test called the 2020 Integrated Public Alert & Warning System due to the ongoing pandemic response. (6/19/20) (New)
  • FEMA announced it was phasing out Project Airbridge. Project Airbridge served as FEMA’s program to shorten medical supply distribution for key COVID-19 supplies. (6/19/20) (New)
  • The DHS, jointly with the Department of Justice, announced that Migrant Protection Protocol (MPP) hearings would resume on July 17. (6/16/20)

Department of Justice/Federal Trade Commission/Litigation   

  • The Federal Trade Commission filed a complaint on June 16 in U.S. District Court for the Eastern District of Louisiana against a Louisiana-based company that allegedly deceived consumers with mailers that claimed to direct them on how to obtain federal COVID-19 stimulus benefits, but instead lured them to a used car sale. The mailing envelopes were labeled “IMPORTANT COVID-19 STIMULUS DOCUMENTS” and led consumers to believe they could obtain stimulus relief temporarily in person at a “relief headquarters” in Florida. When consumers showed up to the address, they only found a lot hosting a car sale. The FTC is seeking injunctive relief to stop the defendants’ actions and to require them to provide redress to their consumers. (6/16/20) (New)

Small Business Administration   

Department of Treasury/IRS/Federal Reserve   

  • The Department of Treasury website for CARES Act business assistance programs.
  • The Internal Revenue Service (IRS) released Notice 2020-50 to clarify the enhanced retirement plan distributions and plan loans as authorized under the CARES Act. This includes expanding the categories of individuals eligible for these types of distributions and loans and providing guidance on how qualified individuals will reflect the tax treatment of these distributions and loans on their federal income tax filings. (6/19/20) (New)
  • The IRS announced new rules for health care spending flexibility as authorized under the CARES Act, including expansion of qualified medical expenses, and how telehealth is treated under high deductible spending health plans. (6/17/20)
  • The recent IRS guidance to expand the medical condition exception, also provides a COVID-19 medical condition travel exception. A&B translates this IRS guidance to offer a better understanding of the IRS procedures and FAQs covered in the recent information. (6/16/20)
  • The IRS alerted nursing homes that Economic Impact payment generally belong to the recipient, not nursing homes or care facilities. (6/16/20)
  • The Department of Treasury released a statement on the opening of the lender registration for the Main Street Lending Program. The full details and portal were posted by the Federal Reserve Bank of Boston. (6/15/20)
  • The Federal Reserve Board announced it will be seeking public feedback on a proposal to expand its Main Street Lending Program to provide access to credit for nonprofit organizations. The Main Street Lending Program minimum loan size is $250,000 while the maximum loan size is $300 million. Principal payments would be fully deferred for the first two years of the loan, and interest payments would be deferred for one year. (6/16/20)
  • Under the proposal, two loan options would be offered. Borrower eligibility requirements for the proposed nonprofit facilities would be modified from the for-profit facilities to reflect the operational and accounting practices of the nonprofit sector and include:
    • Minimum of 50 and maximum of 15,000 employees;
    • Financial thresholds based on operating performance, liquidity, and ability to repay debt;
    • An operational history of at least five years; and
    • A limit on endowments of no more than $3 billion.
  • The deadline for feedback is Monday, June 22 and comments may be submitted here.
  • The Federal Reserve Board announced it will resume examination activities for all banks, after previously announcing a reduced focus on exam activity due to the pandemic. (6/15/20)
  • The Federal Reserve Board announced updates to the Secondary Market Corporate Credit Facility, which will begin buying a broad portfolio of corporate bonds to support market liquidity and the availability of credit for large employers. (6/15/20)

Other Agencies   

  • The U.S. Department of Agriculture announced the purchase of more than $2.2 billion of meat, fruits, vegetables, and special crops and dairy products for food and nutrition programs. (6/16/20)
  • The Cybersecurity and Infrastructure Security Agency (CISA) has posted a COVID-19 disinformation toolkit. (6/17/20)
  • The Federal Communications Commission has announced another 62 telehealth funding applications to health care providers totaling $2.25 million. (6/17/20)
  • The U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) announced an additional two month extension of its foreclosure and eviction moratorium through August 31 for homeowners with FHA-insured Single Family mortgages. (6/17/20)
  • HUD has announced the award of nearly $40 million in housing counseling grants to help individuals and families avoid foreclosure. (6/16/20)
  • The Department of Labor issued guidance to help states protect against fraud in the unemployment insurance program. (6/16/20)

Business Insurance Issues Related to COVID-19   

  • For a 50-state review of business interruption insurance related issues see this new COVID-19 Insurance Litigation and Regulatory Issues tracker. (Weekly update 6/21/20)
  • On June 15, Lieff Cabraser Heimann & Bernstein, LLP filed a complaint on behalf of its client Atelier 1 2 3 Restaurant LLC dba Atelier Crenn against insurers Farmers Group Inc. and Truck Insurance Exchange alleging that Farmer’s Group Inc. wrongfully denied plaintiff’s claim for business interruption coverage. Plaintiff argues that the denial of coverage was “part of a premeditated strategy by Defendant to deny all claims related to the ‘shelter in place’ orders and COVID-19.”Plaintiff claims that the policies at issue provide coverage for several reasons, including because the shelter in place orders resulted in a loss of access to the insured premises necessitating a suspension of business operations. Plaintiff asserts claims for breach of contract, breach of covenant of good faith and fair dealing, unfair business practices under California’s Unfair Competition Law, and declaratory relief. The case is Atelier 1 2 3 Restaurant LLC, et al. v. Farmers Group Inc., et al., No. CGC-20-584762 (San Francisco Cnty. Sup. Ct., filed June 15, 2020).  (New)
  • On June 15, Society Insurance moved to dismiss Rising Dough, Inc.’s putative class action alleging wrongful denial of business interruption coverage.  Society cited several grounds for dismissal including that the policy did not provide business income or extra expense coverage because COVID-19 did not cause “direct physical loss of or damage to covered property.” Moreover, Civil Authority coverage did not exist because Plaintiffs’ alleged losses were not caused by an order of civil authority prohibiting access to the premises on grounds of either damage to other property or a dangerous physical condition. The docket entry is Rising Dough, Inc. v. Society Insurance, No. 2:20-cv-00623-JPS (E.D. Wis.), Dkt. No. 20. (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:

Alston & Bird Coronavirus Links

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