State and Federal Legislative Update: March 17, 2020

State Legislative Update

Overnight, the House and Senate passed a second funding package to address the COVID-19 pandemic. The House passed the bill 108-0, and the Senate passed it 55-0. The legislation, Senate File 4334, includes additional emergency funding of $200 million for hospitals, nursing homes, and other medical professionals to combat the spread of COVID-19.

The emergency Coronavirus funding the Legislature approved last week provided $21 million to support COVID-19 disease investigation, monitor outbreaks, provide public information, coordinate response activities, and conduct laboratory analysis.

Under this legislation, $150 million is appropriated to the Minnesota Department of Health to make grants to eligible providers for costs related to planning for, preparing for, or responding to an outbreak of COVID-19; fund the establishment and operation of temporary sites to provide testing services, to provide treatment beds, or to isolate or quarantine affected individuals to respond to an outbreak of COVID-19; and administer the grant program. The bill defines “eligible provider” as an ambulance service, health care provider, health care clinic, pharmacy, health care facility or long-term care facility, including but not limited to a hospital, nursing facility, or setting where assisted living services or health care services are or may be provided, or health system.

Grants may be used for:

• establishment and operation of temporary sites to provide testing services, to provide treatment beds, or to isolate or quarantine affected individuals
• temporary conversion of a space for another purpose that will revert to its original use
• staff overtime and hiring additional staff
• staff training and orientation
• purchasing consumable protective or treatment supplies and equipment to protect or treat staff, visitors, and patients
• development and implementation of screening and testing procedures
• patient outreach activities
• additional emergency transportation of patients
• temporary IT and systems costs to support patient triage, screening, and telemedicine activities
• purchasing replacement parts or filters for medical equipment that are necessary for the equipment’s operation
• specialty cleaning supplies
• expenses related to the isolation or quarantine of staff (not including wages)
• other expenses not expected to generate income for the eligible provider after the outbreak ends

As a condition of accepting a grant, the provider must agree not to bill uninsured patients for the cost of COVID-19 screening, testing, or treatment. If a patient is out-of-network, the provider must agree to accept the median network rate as payment in full.

The bill also includes an additional $50 million for the public health response contingency account. It allows the Minnesota Department of Health, in consultation with hospitals, ambulance services, emergency management, and public health agencies, to make payments from the public health response contingency account to ambulance services, health care clinics, pharmacies, health care facilities and long-term care facilities. This includes, but is not limited to hospitals, nursing facilities, and settings at which assisted living services or health care services are or may be provided, and health systems, for costs that are necessary on an emergency basis to plan for, prepare for, or respond to pandemic influenza or a communicable or infectious disease.

The Legislature also passed a resolution allowing the House and Senate to adjourn for more than three days. The House and Senate will meet in floor and committee session on an on-call basis through April 14. During this time period, the Legislature will only take up legislation on the House and Senate floors by agreement of the House DFL, House GOP, Senate DFL and Senate GOP caucus leaders. 

Federal Legislative Update

Senate looks to approve Coronavirus bill this week

This week the Senate will consider an economic relief plan, backed by President Trump, to deal with the spreading of COVID-19. The House passed a package that includes free testing for everyone who needs it, and two weeks of paid sick leave to allow people with the virus to stay home from work and avoid infecting co-workers. It also includes enhanced jobless benefits, increased food aid for children, senior citizens and food banks, and funding for Medicaid benefits. Speaker Nancy Pelosi said that while the Senate works on the House bill, her chamber’s leaders will begin working on an additional emergency response measure.

Senate Majority Leader Mitch McConnell said in a statement shortly after Saturday’s House vote that the Senate “will need to carefully review” the House measure. “I believe the vast majority of senators in both parties will agree we should act swiftly to secure relief for American workers, families, and small businesses,” he said. Leader McConnell said in a statement Sunday night that more work would likely be needed, and that he has talked to Senate committee heads about next steps. The Senate Health, Education, Labor, and Pensions Committee will hold a second hearing today on the U.S. response to the outbreak. The exact timing of a Senate vote this week is still uncertain. We will provide updates once the Senate acts.

A closer look: Families First Coronavirus Response Act

On Saturday, March 14, the House passed a sweeping bill aimed at addressing the Coronavirus outbreak. The Families First Coronavirus Response Act was passed on a vote of 363-40 and would provide $8.3 billion for relief efforts. All members of Minnesota’s congressional delegation voted in favor of the bill, with the exception of Congressman Tom Emmer (R-MN-06) who cited the “abrupt and haphazard” actions of the House in a press release explaining his vote.

A number of highlights from the bill can be found below:

• More than $3 billion for research and development of vaccines, therapeutics, and diagnostics
• Nearly $1 billion for procurement of pharmaceuticals and medical supplies, to support healthcare preparedness and Community Health Centers, and to improve medical surge capacity
• An estimated $7 billion in low-interest loans to affected small businesses, to help cushion the economic blow of the public health emergency
• $300 million so the government can purchase vaccines at a fair and reasonable price
• The measure would appropriate $250 million for Health and Human Services Department programs that aid elderly Americans
• States would be eligible for a 6.2 percentage point increase in their federal medical assistance percentages
• Insurers would be required to cover coronavirus tests and related services, such as provider visits for testing, without cost-sharing or prior authorization requirements. The cost-sharing prohibition would also apply to Medicaid, Medicare, TRICARE, veterans’ health programs, the Indian Health Service, and coverage provided to federal civilian employees.
• Supplemental funds for federal nutrition assistance programs:
• $500 million in emergency funding for the WIC program
• $400 million for the Commodity Assistance Program for the emergency food assistance program, $100 million of which could be used for costs related to the distribution of goods
• The measure would waive federal work requirements for SNAP eligibility. States that make their own emergency or disaster declarations related to COVID-19 could request emergency allotments of food aid to support increased participation in SNAP and address temporary food needs.
• The agreement would create an emergency paid leave program to directly respond to the coronavirus.
• Private sector employers with fewer than 500 workers and government entities would have to provide as many as 12 weeks of job-protected leave.
• Full-time employees would receive 80 hours of sick leave under the new emergency leave program and part-time workers would be granted time off that’s equivalent to their scheduled or normal work hours in a two-week period.
•  Small businesses with fewer than 50 employees would be exempt through authorized Labor Department regulations.
• The measure would provide payroll tax credits to employers to cover wages paid to employees while they are taking time off under the bill’s sick leave and family leave programs
• The measure would provide as much as $1 billion for emergency transfers to states in fiscal 2020 to process and pay unemployment benefits

Local government impacts

• The bill would ensure that state and local governments are reimbursed for costs incurred while assisting the federal response.
• It would also include a requirement to reimburse $136 million to important health accounts, including mental health services, substance abuse treatment and prevention, and heating and cooling assistance for low-income families.
• $25 million cooperative agreement to the states and local jurisdictions who have borne the largest burden of response and preparedness activities to date.
• $10 million cooperative agreement to state and local jurisdictions to begin implementation of Coronavirus surveillance across the U.S., building on existing influenza activities and other surveillance systems.
• For more information on local government provisions of the bill, see the National League of Cities Response Resources page.

Fed slashes rates as U.S. economy braces for virus

The Federal Reserve moved into action on Sunday in an effort to save the U.S. economy from the fallout of the Coronavirus, slashing its benchmark interest rate by a full percentage point to near zero and promising to boost its bond holdings by at least $700 billion. Underlining the sense of urgency amid mounting recession fears, Fed Chairman Jerome Powell told the press by telephone that the virus’s disruption to lives and businesses meant second quarter growth would probably be weak and it was hard to know how long the pain would last. The Fed’s key rate is now zero to 0.25%, matching the record low level it hit during the 2008 financial crisis and where it was held until December 2015. The central bank also announced several other actions, including letting banks borrow from the discount window for as long as 90 days and reducing reserve requirement ratios to zero percent. In addition, it united with five other central banks to ensure dollars are available around the world via swap lines. Chairman Powell said that he did not think negative rates, which have been used in Europe and Japan, would be appropriate policy in the U.S.