Coronavirus Flash Update April 22, 2020

Coronavirus Flash Update: April 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 WEDNESDAY, APRIL 22, 2020

The Latest News

  • U.S. COVID-19 cases exceed 805,772 and 40,316 U.S. deaths. (Source: CDC) (Updated 4/22/20)
  • U.S. stock market: Tuesday ended with a second consecutive day of losses in the U.S. benchmarks, with the Dow down 631 points, the S&P dropping 86 points, and the Nasdaq losing 297 points.  (New)
  • Late yesterday, the Senate passed by unanimous consent a $484 billion Paycheck Protection Program and Health Care Enhancement Act (also called bill 3.5), which provides additional funding for several key CARES Act programs. This supplemental relief package includes $310 billion for the Paycheck Protection Program, $60 billion or the Economic Injury Disaster Loan program, $75 billion for health care providers (supplemental to previous $100 billion in the CARES Act), and $25 billion for testing. The House is scheduled to vote on Thursday, and President Trump has said he will sign the bill. Also available are a section-by-section summary and an overview of the health care provisions. (New)
  • During last night’s White House press briefing the President stated he will sign an executive order (perhaps tomorrow) temporarily “pausing,” for period of 60 days, certain U.S. immigration processes. He said this will not apply to foreign nationals applying for or seeking entry to the U.S. in the temporary non-immigrant visa categories, such as tourist, F-1 student, L-1 intra company transfer, E-2 investor or other temporary work visas – and he noted it would not apply to farm workers. The President added that the 60-day pause would bar foreign nationals from receipt of green cards/immigrant visa and from coming to the U.S., but that it may apply to foreign workers coming to the U.S. on employment-based green cards. The full details will not be available until the executive order is released. (New)

COVID-19 Related Legislation   

  • Bill 4.0: Following Senate passage of the $484 billion Paycheck Protection Program and Health Care Enhancement Act last night, and expected passage in the House later this week, Congress and the Administration will pick up the pace on their drafting and negotiations for the 4.0 emergency relief bill. The 4.0 bill has become the focus of issues which have not been addressed in the previous relief bills, including possible technical corrections to earlier action. Congressional leadership are working towards action in the first half of May. (New)
  • The House Rules Committee is scheduled to consider a resolution later today which would allow the House to vote by proxy. The Resolution would allow a member to cast a vote on behalf of another member and the requirements are summarized here. (New)
  • 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:
    • A&B Summary CARES Act Health Provisions
    • A&B Overview CARES Act Health Care Grants and Reimbursement Changes
    • A&B Overview CARES Act Key Health Care Appropriations
    • A&B Analysis CARES Act Funding Sources
    • A&B Summary CARES Act Small Business Provisions
    • A&B Summary CARES Act Educational Provisions and Appropriations
    • A&B SummaryCARES Act Individual and Business Tax Provisions
    • A&B SummaryCARES Act Unemployment Provisions
    • A&B SummaryCARES Act Labor Provisions
    • A&B Guide – how the CARES Act refundable Employer Retention tax credit for employers works
    • A&B Hospital Provisions from all 3 relief bills tracker of COVID-19 (Updated on 4/19/20)
    • A&B Summary of oversight and enforcement provisions in the CARES Act
  • 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.

Key Administrative and Regulatory Actions 

  • President Trump temporarily halted funding of approximately $400 million per year to the World Health Organization due to criticisms of the organization’s response to COVID-19. (4/14/20)
  • The U.S. Census Bureau announced that it was temporarily suspending field data collection activities until June. The Census Bureau also requested from Congress a 120-day delay on some data reporting deadlines, including data necessary for congressional apportionment. (4/13/20)
  • The White House unveiled a new hashtag, #AmericaWorksTogether, that will be used to promote companies that are hiring employees during the economic crisis and donating food and other supplies to health care workers. (4/7/20)
  • President Trump declared a national emergency under the Stafford Act, which allows the federal government to marshal additional resources and authorize greater regulatory flexibility to respond to the coronavirus outbreak. (3/13/20)

Transition to “Opening Up”   

  • During a meeting with governors, President Trump released “Opening Up America Againguidelines but left the decision of when his recommended phases should begin to state governments. (4/16/20)
  • The Office of Personnel Management and Office of Management and Budget issued (4/20/20) a memorandum to federal agency and department heads to align operations with these national guidelines (New).
  • On Sunday, CMS announced recommendations to re-open health care facilities to provide non-emergent non-COVID-19 care, including elective surgeries. The recommendations state that non-COVID-19 care should be offered as clinically appropriate if the state, locality, or facility has the resources to provide such care and the ability to quickly respond to a surge in COVID-19 cases if necessary. (4/19/20)
  • Re-opening decisions should be consistent with public health information and in collaboration with state public health authorities, and be pursuant to careful planning that considers all aspects of care, such as:
    • Adequate facilities, workforce, testing, and supplies
    • Adequate workforce across phases of care (e.g., availability of clinicians, nurses, anesthetists, pharmacy, imaging, pathology support, and post-acute care)
  • A joint statement was released on Friday by the American College of Surgeons, American Hospital Association, American Society of Anesthesiologists, and Association of periOperative Registered Nurses stating that “readiness to resume elective surgery will vary by geographic location” and outlining principles and considerations to guide the resumption of elective surgery and other procedures. (4/17/20)
  • As state and local governments consider the transition to re-opening businesses, most are preparing for what might be their next steps to protecting health and safety of their work force while opening up. This A&B advisory lays out what restarting might look like, including how to communicate to your employees, vendors and customers, and planning for continued health and safety issues. (4/17/20)
  • The President announced several “Great American Economic Revival Industry Groups” made up of business executives, economists, academics, and others to “chart the path forward toward a future of unparalleled American prosperity.” (4/14/20)

Department of Defense   

  • The Department of Defense (DOD) announced (4/21/20) $133 million in contracts with 3M, O&M Halyard, and Honeywell to produce 39 million N95 masks over the next 90 days (New).
  • The White House issued (4/20/20) a memorandum extending the authorization to permit state governors to use National Guard troops to respond to COVID-19 (New).
  • The DOD Defense Logistics Agency (DLA) announced a list of available excess medical equipment being made available to FEMA and HHS to be distributed to health care providers as need. (4/17/20)
  • The DOD Cyber Exchange Network has updated its information on the do’s and don’ts of network utilization and cybersecurity, and its top telework rules. (4/17/20)
  • The Under Secretary of Defense for Personnel and Readiness signed a department-wide authorization for service members to accrue and retain an additional leave balance of up to 120 days in response to the limits the spread of COVID-19 has had on limiting service members leave. (4/16/20)
  • The Office of the Under Secretary of Defense released a memo stating that DoD contracts contain clauses that provide “that a contractor will not be in default because of a failure to perform the contract if the failure arises beyond the control and without the fault or negligence of the contractor.” (4/2/20)

Environmental Protection Agency   

  • House committee chairs sent (4/21/20) a letter to the Environmental Protection Agency (EPA) regarding its temporary COVID-19 enforcement policy, asking the agency to establish an end date for the policy, require facilities provide notice before endangering public health or the environment, post information on its website regarding changes to compliance obligations, and make sure staff have enough information to determine that an instance of non-compliance was caused by COVID-19 (New).
  • On April 17, EPA updated its coronavirus website to include new resources for state, local, and tribal agencies and intergovernmental associations. The website consolidates press releases, information on enforcement and compliance programs, water infrastructure, grants, and other applicable resources.
  • EPA is continuing to update its Frequent Questions Related to Coronavirus (COVID-19) website to address questions relating to disinfectants, drinking water, grants, indoor air, wastewater and septic systems, and waste.
  • EPA revised (4/14/20) its prior amendment (dated 3/31/20) allowing manufacturers of already-registered EPA disinfectants on EPA’s List N: Disinfectants for Use Against SARS-CoV-2 to obtain certain active ingredients from any supplier without checking with the agency for approval. In an announcement, the EPA stated that the revisions streamline the process for adding additional registered sources of active ingredients to a formulation and setting up an approved pesticide manufacturing establishment.
  • EPA revised List N: Disinfectants for Use Against SARS-CoV-2 to include products on EPA’s List G: Products effective against norovirus, and List L: Products effecting against the Ebola virus, as EPA has determined that these products also meet its criteria for use against SARS-CoV-2.
  • The EPA issued interim guidance to the Agency’s regional offices to ensure that decisions about new or ongoing cleanup activities at sites across the country are made with the health and safety of communities as related to COVID-19. The interim guidance focuses on decision making at emergency response and longer-term cleanups sites where EPA is the lead agency or has direct oversight of, or responsibility for, the cleanup work.  (4/10/20)

Federal Communications Commission   

  • The Federal Communication Commission (FCC) adopted a program appropriating $200 million in COVID-19 telehealth grants (the COVID-19 Telehealth Program) and $100 million in grants through the Connected Care Pilot Program to assist hospitals and other health care providers cover telehealth costs. (3/31/20).
    • On April 21, the FCC announced the second set of health care providers to receive telehealth grants (New). On April 16, the first six health care providers awarded funding were announced.
  • The funds for both were authorized by the CARES Act. Also see the FCC’s Report and Order for more information.
  • The FCC suspended (4/21/20) its “red light” rule for the telehealth funding program, allowing applications to proceed even if entities are delinquent on payments to the FCC (New).
  • The FCC COVID-19 Telehealth Program Application Portal opened on April 13. See here for more information, the application via the portal, details on eligibility determination and the use of a FCC Form 460 with the Universal Service Administrative Company (USAC). Register to obtain an FCC Registration Number (FRN) in the Commission Registration System (CORES); and register with System for Award Management in order to receive funding.
  • The FCC also provided additional detail on the Connected Care Pilot Program. The selected pilot projects will be supported for a three-year funding period, with separate transition periods of up to six months before and after the funding period (up to four years total).The FCC plans to provide an application form (“Connected Care Pilot Program Application”) that must be used when submitting project proposals to the FCC. Submitted applications must reference WC Docket No. 18-213. Applicants may file using the ECFS, but also must send a courtesy copy of the application via email to ConnCarePltProg@fcc.gov.
    • Additional details on the application, evaluation process and deadline can be found in the Report and Order.
  • The FCC released guidance for applicants that receive funding commitments from the Wireline Competition Bureau COVID-19 telehealth program on how to invoice the Commission for the funded services and/or connected devices. (4/17/20) (New)
  • The FCCissued (4/3/20) an order waiving the content sponsorship requirements during commercial advertising. The purpose of the order is to permit companies that have purchased advertising time to donate the time for the purpose of broadcast public service announcements prepared by the CDC or other governmental or public health agencies regarding COVID-19.
  • The FCCprovided relief on April 1 to enable rural broadband and phone providers to immediately waive consumer fees, including late payment and installation and cancellation fees, in order to help Americans work from home or access remote learning.

Department of Health and Human Services   

  • The Department of Health and Human Services (HHS) has a COVID-19 Resources page.
  • HHS announced (4/21/20) nearly $1 billion in CARES Act grants to support older adults and persons with disabilities. A breakdown of the grants is available here (New).
  • The Substance Abuse and Mental Health Services Administration (SAMHSA) announced (4/20/20) that it would begin releasing $110 million in emergency grant funding for substance use treatment and mental health services. Information on the grants is available here (New).
  • HHS Secretary Alex Azar released a statement announcing plans to launch a public-private partnership with over a dozen companies to develop a national strategy for a coordinated research response to the COVID-19 pandemic. The effort will be called the Accelerating COVID-19 Therapeutic Interventions and Vaccines (ACTIV) partnership. (4/17/20)
  • A component of the ACTIV partnership, the National Institutes of Health announced its own partnership to speed COVID-19 vaccine and treatment options by bringing together biopharmaceutical companies for a coordinated research response. (4/17/20)
  • HHS announced five new contracts under ventilator production under the Defense Production Act, to General Electric, Hill-Rom, Medtronic, ResMed, and Vyaire, as well as two other contracts for ventilator production, to Hamilton and Zoll. HHS has finalized contracts to supply 6,190 ventilators for the Strategic National Stockpile by May 8 and 29,510 by June 1. (4/13/20)
  • An agreement was reached by HHS with General Electric, under the Defense Production Act, to produce 50,000 ventilators by July 13. (4/16/20)
  • Agency for Community Living released an FAQ on their Emergency Funding Operations that includes information about aging and disability funding and the funding allocation by state for the funds. (4/16/20)
  • HHS Administration for Children and Families (ACF) announced $6.3 billion in additional funding, $3.5 billion of which is for the Child Care and Development Block Grant. This funding will go to state, territory, and tribal Child Care and Development Fund (CCDF) programs and is intended to provide assistance to childcare providers. Additional resources are also available. See the ACF summary of the relevant CARES Act section here. Of note, ACF provides information on how “Lead Agencies” can estimate their CARES Act awards through the State and Territory Allocation table on the website. (4/14/20)
  • The HHS Agency for Healthcare Research and Quality (AHRQ) announced that in recognition of the impact COVID-19 was having on their grantee recipient community that AHRQ will be doing providing some flexibility with SAM registration, application deadlines, no-cost extensions for expiring awards, allowability of costs not normally charged to awards, abbreviated non-competitive continuation requests, extensions of close-outs and other flexibilities. (4/13/20)
  • HHS Secretary Alex Azar sent a letter to hospital Administrators on April 10 reinforcing the need for data and daily reports on testing, capacity, supplies, utilization and patient flows. The letter included a set of frequently asked questions that details federal government’s data needs, explains the division of reporting responsibility between hospitals and states, and provides clear, flexible options for the timely delivery of this critical information. (4/10/20)
  • HHS has a tracking feature that allows public viewing of all COVID-19 HHS grant and cooperative agreement awards on its website. The initial grants were distributed through programs in the ACL, CDCD, NIH, and ASPR.
  • The HHS Office of Human Research Protection (OHRP) released guidance for investigators, institutional review boards, and institutions conducting human subjects research during the coronavirus (COVID-19) pandemic. “The important thing to recognize is that our rules for protecting research subjects should not stop us from addressing this extraordinary public health crisis.” (4/10/20)
  • The HHS Office of Inspector General (HHS-OIG) issued (4/3/20) a policy statement regarding the application of previously issued blanket waivers to Anti-Kickback Statute
    • OIG announced its decision to exercise its enforcement discretion to not impose administrative sanctions under the federal Anti-Kickback Statute (AKS) for certain renumeration related to COVID-19. Specifically, OIG is applying 11 of the 18 waivers previously issued by CMS for physician self-referral law sanctions to administrative sanctions.
  • The HHS Office of Civil Rights (OCR) released a notification that it will exercise its enforcement discretion and will not impose penalties for violations of the HIPAA Rules against covered entities or business associates in connection with the good faith participation in the operation of COVID-19 testing sites during the COVID-19 nationwide public health emergency. This exercise of enforcement discretion is effective immediately but has a retroactive effect to March 13, 2020. (4/9/20)

Assistant Secretary for Preparedness and Response   

  • ASPR posted a Hospital Resource Package on TRACIE. The online resource includes COVID-19 guidance and resources for hospital administrators, hospital emergency planners, and infection control practitioners in the following topical areas: hospital surge, crisis standards of care, staffing surge and resilience, workforce protection, regulatory relief, equipment supply surge, and telemedicine. (4/16/20)
  • ASPR has updated its website to include additional information about the Strategic National Stockpile, including new pages on SNS ventilators being deployed in response to COVID-19. (4/13/20)

Centers for Disease Control and Prevention  

  • For the most up to date CDC guidance click here.
  • The CDC announced (4/20/20) an extension of its March 20 order suspending travel of certain persons from countries with COVID-19 outbreaks (New).
  • The CDC recently updated or issued several guidance documents and resources, including: interim guidance on safety practices for critical infrastructure workers who may have been exposed to a person with suspected or confirmed COVID-19; online FAQ for testing and reporting by laboratories; resources for businesses and employers; guidance for institutes of higher learning; guidance for cleaning and disinfecting public spaces, workplaces, businesses, schools, and homes; guidance for childcare programs; FAQs on healthcare infection prevention and control; information for airline catering kitchen workers; information for airport retail and food service workers; information for mail and parcel delivery drivers; information for rideshare, taxi, limo, and other passenger drivers; information for food and grocery pick-up and delivery drivers; information for firefighters and EMS providers; information for screening clients at homeless shelters (New or updated).
  • The CDC has developed a new serology test to detect whether an individual had an immune response to SARS-CoV-2. This test will assist in the effort to determine how many individuals have been exposed to the virus which causes COVID-19. (4/17/20)
  • The CDC has posted key strategies to prepare for COVID-19 in Long-Term Care Facilities and released information on what to consider when preparing for assisted living facilities. (4/17/20)
  • The CDC has organized a central webpage for health care professional training information and webinars. (4/16/20)
  • The CDC updated their interim guidelines for collecting, handling, and testing clinical specimens from persons for COVID-19. (4/16/20)
  • This guidance provides information for clinicians on how to collect, store, and ship specimens appropriately, including during afterhours or on weekends/holidays. The updated guidance clarifies specimen collection procedures for all swab types and aligns with other respiratory disease specimen collection guidelines.
  • The CDC released a presentation that includes guidance on management of COVID-19 in correctional and detention facilities. (4/15/20)
  • The CDC announced new recommendations for cleaning and disinfecting your facility, and also updated their guidance on what to do if you are sick. (4/14/20)
  • The CDC updated its infection prevention and control guidance for patients with suspected or confirmed COVID-19 in health care settings. And:
  • New guidance on Decontamination and Reuse of Filtering Facepiece Respirators. This document summarizes research about decontamination of FFRs before reuse. (4/13/20).
  • New has updated guidance for dental settings. (4/13/20)
  • The CDC has launched a new COVID-19 surveillance webpage which includes links to all of the COVID-19 surveillance systems and other data sources CDC is using to track COVID-19 activity. (4/13/20)
  • The CDC announced an extension of its “No Sail” order for all cruise ships for at least 100 days. (4/9/20)
  • The CDC released new guidance (4/9/20) advising that critical infrastructure workers may be permitted to continue work following potential exposure to COVID-19, provided they remain asymptomatic and additional precautions are implemented to protect them and the community.

Centers for Medicare & Medicaid Services  

  • The Centers for Medicare and Medicaid Services (CMS) created a website location for COVID-19 stakeholder call recordings and transcripts, and the most recent daily CMS COVID-19 news alert on all actions can be found here (last updated 4/16/20). The number of CMS conference calls and webinars keep a steady pace.
  • CMS announced (4/21/20) extending the implementation timeline for the final rule on interoperability and patient access as to admission, discharge, and transfer notification conditions of participation by six months, meaning that the rules will now go into effect 12 months after the rule is published (New).
    • Relatedly, CMS, HHS-OIG, and the Office of the National Coordinator for Health IT (ONC) issued (4/21/20) a press release announcing that they were exercising discretion to delay enforcement of parts of the final rule (New).
  • CMS updated (4/21/20) its March 10 guidance to Medicare Advantage plans, Part D sponsors, and Medicare-Medicaid plans (New).
  • CMS announced (4/21/20) that it was issuing guidance allowing independent freestanding emergency departments (IFEDs) in Colorado, Delaware, Rhode Island, and Texas to provide care to Medicare and Medicaid patients (New).
  • CMS announced (4/20/20) that clinicians who participate in the Quality Payment Program (QPP) can earn Merit-based Incentive Payment System (MIPS) credit for participation in clinical trials using a drug or biological product to treat a patient with a COVID-19 infection (New).
  • On Sunday, CMS announced that nursing homes would be required to inform residents, their families of COVID-19 cases in their facilities. The guidance will also require nursing homes to report cases of COVID-19 directly to the CDC. This measure augments requirements for reporting infectious disease to State and local health departments. CDC will be providing a reporting tool to nursing homes that will support Federal efforts to collect nationwide data to assist in COVID-19 surveillance and response. (4/19/20)
  • CMS announced (4/18/20) that it was exercising enforcement discretion to adopt a temporary policy of relaxed enforcement and is directing all eligible qualified health plan issuers to discontinue the collection of clinical quality measure data and survey measure data that would normally be reported between May and June 2020 (New).
  • CMS issued a ruling stating that it is increasing Medicare reimbursement to $100 for COVID-19 diagnostic testing performed using high-throughput technologies. Reimbursement for COVID-19 diagnostic tests using technology other than high-throughput technologies continue to be reimbursed at $51. (4/16/20)
  • CMS issued a release announcing new guidance expanding private insurance coverage to all COVID-19 diagnostic testing and related services at no co-pay, including antibody testing. The release was jointly issued with the Departments of Labor and the Treasury, and it included the guidance and FAQs. (4/11/20)
  • CMS issued additional information on transferring patient between post-acute facilities which include skilled nursing facilities and nursing homes. (4/13/20)
  • CMS announced the postponement of the 2019 benefit year HHS Risk Adjustment Data Validation (HHS-RADV) process. CMS intends to provide future guidance in the summer of 2020 on the updated timeline for 2019 benefit year HHS-RADV activities that are planned to begin in 2021. CMS previously announced a similar suspension of the Medicare Advantage RADV program. (4/13/20)
  • In an April 10 memo to Medicare Advantage (MA) plans, CMS clarified that MA plans can use diagnoses from telehealth visits in risk adjustment. (4/10/20)
  • CMS issued a “Dear Clinician” letter that outlining a summary of actions CMS has taken to ensure clinicians have maximum flexibility to reduce unnecessary barriers to providing patient care during the unprecedented outbreak of COVID-19. The summary includes information about telehealth and virtual visits, accelerated and advanced payments, and recent waiver information. (4/7/20)
  • CMS issued a Medicare Advantage and Part D rate announcement for CY 2021 with an 1.66% average change in revenue relative to last year. The announcement does not catalog CMS’s actions regarding COVID-19, but these are explained in a summary included with the announcement. (4/6/20)
  • On March 30, CMS released an Interim Final Rule, which made numerous regulatory changes to provide additional flexibility for health care providers and temporarily remove certain limitations on care delivery. These changes have retroactive applicability to March 1. While many of these changes were developed prior to the enactment of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), significant flexibility has been conferred on individuals and entities that provide health care services to Medicare beneficiaries during the COVID-19 public health emergency. Comments are due not later than June 1, 2020.
  • On April 9, CMS issued FAQs regarding this interim final rule. See this A&B Summary for the key details of the Interim Final Rule. (4/8/20)

CMS CARES Act Guidance  

  • The CARES Act Provider Relief Fund webpage has been updated to include the Attestation Portal. As a reminder, providers receiving payment from the initial $30 billion distribution must sign an attestation confirming receipt of the funds and agree to the Terms and Conditions within 30 days of payment. Additionally, CMS has set up a CARES Act Relief hotline: (866) 569-3522. Entities can also try contacting the Provider Hotline at the applicable MAC.
  • On April 10, CMS began distributing the initial $30 billion in COVID-19 relief funding to providers as part of the distribution of the $100 billion fund provided for the Public Health and Social Services Emergency Fund (PHSSEF) through the CARES Act. This initial distribution of funds will go to hospitals and providers currently enrolled in Medicare and take effect immediately.
  • Facilities and providers are allotted a portion of the $30 billion based on their share of 2019 Medicare fee-for-service (FFS) reimbursements. These are payments, not loans, and will not need to be repaid. Additional details can be found here.
  • Updated Terms and Conditions available here and the portal to attest to Terms and Conditions released April 16, 2020.
  • CMS issued guidance implementing Section 3709 of the CARES Act, which temporarily suspends the 2% payment adjustment currently applied to all Medicare Fee-For-Service (FFS) claims due to sequestration. The guidance notes that the suspension is effective for FFS claims with dates of service from May 1 through December 31, 2020.
  • In response to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), CMS continues to release guidance required under the Act:
  • CMS have provided guidance, in accordance with the CARES Act (Sec. 3710 and 3711), which includes waivers for inpatient rehabilitation facilities (IRF) 3-hour rule, the long-term care hospitals (LTCH) site-neutral policy and LTCH “50% rule.” The guidance provides detail on the add-on payment of 20% for both rural and urban hospitals, and the policy waives the requirement that Medicare Part A fee-for-service patients treated in IRFs receive at least 15 hours of therapy per week. (4/16/20)
  • On March 30, CMS announced sweeping changes in response to requirements of the CARES Act. The changes are summarized in this CMS release. The new waivers and flexibilities for health care providers as well as the types of waivers are outlined by CMS here.
  • The telehealth expansion waiver, which was originally expanded in the Coronavirus Preparedness and Response Supplemental Act (1.0), was further expanded in the CARES
    • On Friday, April 17, CMS announced the telehealth rate for rural health centers (RHCs) and federal qualified health centers (FQHCs) to provide distant site telehealth services as authorized by the CARES Act. RHCs and FQHCs able to provide telehealth services with interactive audio and video telecommunications will receive a payment rate of $92. RHCs and HQHCs do not need to resubmit claims for payment adjustment – all claims will be automatically reprocessed in July. (4/17/20)
    • Telehealth guidance (3/17/20) broadened access to Medicare telehealth service regardless of patient residence and covering a wide range of services. Factsheets related to these changes:
    • CMS issued an electronic toolkit regarding telehealth and telemedicine for Long Term Care Nursing Home Facilities (3/28/20); CMS telehealth FAQs (3/17/20); HHS 1135 HIPAA waiver factsheet - HIPAA Security Rule safeguards; HHS Notice of Enforcement Discretion factsheet; HHS Office of Civil Rights bulletin Guidance on Business Associate Agreements
  • The CARES Act required CMS to expand its accelerated and advance payment program, and CMS released a statement and fact sheet providing guidance on the policy. (3/28/20) According to the latest CMS update – $94.7 billion has been distributed as of April 17.
  • CMS announced the interest rate on overdue and delinquent debts for Q3 of Fiscal Year 2020 (April-June) – 625%. This updates the prior quarter’s interest rate of 10.25%, which is currently expected to apply to the Medicare Accelerated and Advance Payments Program (AAPP). In addition, CMS released a transmittal reflecting this change effective April 20, 2020 for Medicare overpayments and underpayments. Specifically, the transmittal instructs Medicare contractors to implement an interest rate of 9.625% to Medicare overpayments and underpayments. We will continue to monitor for additional information and any updates or changes with respect to the AAPP. (4/14/20)
  • CMS released a state-by-state list showing the breakdown of receipt of accelerated and advance payments as of April 4, 2020. (4/13/20)
  • Medicaid:
  • CMS Center for Medicaid and CHIP Services (CMCS) released additional FAQs that address enhanced federal Medicaid funding (FMAP) and related Medicaid issues under requirements from FFCRA and CARES Act. (4/14/20)

Food and Drug Administration (Drugs and Devices)  

  • FDA provides a daily roundup on COVID-19 related actions. The latest update is here, (revised 4/21/20), and here is a listing of all announcements.
  • The agency published a public database of drug shortages.
  • The Drug Enforcement Administration (DEA) is adjusting 2020 production quotas for controlled substances in schedule II of the Controlled Substances Act, as well as quotas for the manufacture and importation of the Schedule I chemicals ephedrine, phenylpropanolamine and pseudoephedrine.
  • On Monday, in response to a request from LabCorp to amend their original use Emergency Use Authorization (EUA), FDA reissued the EUA for the first diagnostic test with a home collection option (New). (4/20/20)
  • FDA issued a guidance (4/20/20) explaining its temporary policy regarding state-licensed pharmacies and federal facilities (that are not outsourcing facility) compounding certain human drugs for hospitalized patients during the COVID-19 public health emergency (New).
  • FDA issued (4/18/20) an Emergency Use Authorization for general purpose face masks. This is a significant development, because it eliminates any doubt that such face masks that were not FDA-approved or FDA-cleared can nonetheless enjoy PREP Act liability protection as authorized masks under an EUA (New).
  • FDA has posted a webpage on convalescent plasma including links to additional resources. (4/18/20)
  • FDA announced expansion of COVID-19 testing options through the recognition that spun synthetic swabs could be used to test patients by collecting a sample from the front of the nose. The swabs are manufactured by S. Cotton, who developed a polyester-based Q-tip-type swab that is fully synthetic for compatibility with COVID-19 testing. (4/16/20)
  • FDA issued enforcement policy guidance to help expand the availability of telethermographic systems used for body temperature measurements for triage use for the duration of the public health emergency. (4/16/20)
  • The FDA announced an update on convalescent plasma, a potential COVID-19 treatment, and encouraging those who have recovered from COVID-19 to donate plasma to help others fight this disease. (4/16/20)
    • The FDA launched a website to provide a process for the donation of plasma. (4/13/20)
  • The FDA issued guidance to communicate its temporary policy for the compounding of certain human drug products for hospitalized patients by outsourcing facilities that have registered with FDA under section 503B of the Federal Food, Drug, and Cosmetic Act. (4/16/20)
  • FDA provided Stryker Instruments emergency use for its Sterizone VP4 Sterilizer1 N95 Respirator Decontamination Cycle, a self-contained stand-alone device. (4/14/20)
  • FDA announced the availability of two final guidance for industry: “Guidance on Chloroquine Phosphate” and “Guidance on Hydroxychloroquine Sulfate,” to ensure an adequate supply of these products. As a previous step, on March 28th, FDA issued an EUA to allow these products to be donated to the Strategic National Stockpile to be distributed and used for certain COVID-19 patients. (4/14/20)
  • The FDA issued an emergency use authorization (EUA) to the STERIS Corporation to allow the company to employ its system to decontaminate compatible N95 or N95 equivalent respirators for reuse by health care workers in hospital settings. (4/10/20)
    • Information regarding manufacturing, importing, or selling sterilizers, sanitizers, purifiers, and disinfectants is available in this A&B advisory (4/13/20).
  • FDA and FTC continue to issue Warning Letters to sellers of fraudulent COVID-19 products for prevention for COVID-19, including CBD products. FDA also issued a warning letter (4/8/20) to a seller that markets fraudulent and dangerous chlorine dioxide products.
  • FDA announced (3/31/20) the Coronavirus Treatment Acceleration Program (CTAP), a new program to expedite the development of potentially safe and effective life-saving treatments.
  • FDA has issued enforcement policies to increase the availability of ventilators and accessories, face masks and respirators, gowns, other apparel and gloves, sterilizers, disinfectant devices, and air purifiers, clinical electronic thermometers, infusion pumps and accessories, remote ophthalmic devices and monitoring devices, extracorporeal membrane oxygenation, cardiopulmonary bypass devices, and digital health devices for treating psychiatric disorders.
  • The FDA updated its FAQs (4/2/20) on surgical masks and gown shortages.
  • FDA has provided strategies to assist in the conservation of masks and gowns, as well as glove conservation strategies.

Food and Drug Administration and United States Department of Agriculture (Food-Related)  

  • The US Department of Agriculture (USDA) announced a $1.9 billion food assistance program to provide support for farmers, ranchers, and consumers. The program will provide direct support to farmers and ranchers, and it will purchase and distribute food. This assistance was authorized in FFCRA and CARES Act. (4/17/20)
  • The FDA has posted tips for food shoppers to reassure consumers there is currently no evidence of human or animal food being associated with transmission of the coronavirus. (4/16/20)
  • USDA’s Agricultural Marketing Service announced that for 60 days, beginning April 20, 2020, it will not take enforcement action against the retail sale of commodities that lack an appropriate country or origin or method of production label as required for covered commodities under COOL, provided the food does not make any country of origin or method of production claims. (4/13/20)
  • USDA announced a resource guide for rural leaders on funding and partnership opportunities regarding COVID-19. (4/13/20)
  • FDA has put out a factsheet on best practices for retail food stores, restaurants, and food pick-up and delivery services during the COVID-19 pandemic. This includes information on managing employee health, personal hygiene for employees, appropriate food safety protocols, and special safety considerations for pick-up and delivery. A visual summary info graph is also available. (4/6/20)
  • Department of Agriculture (USDA): USDA Rural Development Division has launched a resource page to help rural residents, farmers, and businesses stay current on the Agency actions related to COVID-19.
    • USDA and the Department of Homeland Security announced a temporary final rule to change certain H-2A requirements to help U.S. agricultural employers avoid disruptions in lawful agricultural-related employment, protect the nation’s food supply chain, and lessen impacts from the coronavirus (COVID-19) public health emergency. (4/15/20)
  • The Rural Development Office has posted a fact sheet of funding opportunities for rural residents, businesses and communities. (4/8/20)

Health Resources and Services Administration   

  • The Health Resources and Services Administration (HRSA) announced the opening of a funding opportunity for tribal organization. The $15 million was authorized by the CARES Act and dedicated for tribal organizations, Indian health organizations, and health service providers to tribes. (4/17/20)
  • HRSA awarded $90 million for Ryan White HIV/AIDS Program recipients as authorized by the CARES Act. Several materials were provided including as release and links to recipients: links to the awardees. (4/15/20)
  • Note that there are Ryan White HIV/AIDS Program Parts A, B, C, D, and F award recipients:

Department of Homeland Security/FEMA   

  • The Department of Homeland Security (DHS) provides a weekly roundup of its response to COVID-19 (last updated 4/13/20).
  • DHS issued (4/20/20) a press release announcing that the United States, Mexico, and Canada had agreed to extend restrictions on non-essential travel across their shared borders for an additional 30 days (New).
  • The DHS Cybersecurity Infrastructure and Security Agency (CISA) released updated guidance on Essential Critical Infrastructure Worksto help state and local jurisdictions and the private sector. CISA notes this version, “3.0 provides clarity around a range of positions needed to support the critical infrastructure functions laid out in the original guidance.” (Updated 4/21/20)
  • Federal Emergency Management Agency’s (FEMA) coronavirus website visit here.
  • FEMA released a statement on applying the Defense Production Act (DPA) providing additional background on how FEMA operates under the DPA and provides some examples of COVID-19 DPA actions, including contracts for ventilator production. (4/15/20)
  • FEMA has created a hospital resource package webpage to provide links to Federal and non-Federal resources. (4/16/20)
  • FEMA announced (4/14/20) the funding notice for $100 million in supplemental Emergency Management Performance Grant Program funds. The funds are available to all 50 states and six territories as part of the CARES Act. Applications are due by April 28.
  • Temporary FEMA rule will ban export of some medical equipment without approval. Some medical equipment needed to combat COVID-19 cannot be exported from the U.S. without the “explicit approval” of the Federal Emergency Management Agency, according a new rule set to take effect this week. The “temporary final rule” will be effective from April 10 through mid-August, according to a Federal Register notice. (4/10/20)
  • FEMA issued (4/10/20) a temporary final rule to restrict the export of five types of personal protective equipment (PPE).
  • FEMA has established How to Help website for individuals and organizations interested in helping the effort to combat the spread of COVID-19. Examples of assistance offered include:
  • To sell medical suppliesor equipment to the federal government, please submit a price quote under the COVID-19 PPE and Medical Supplies Request for Quotation.
  • Do you have medical supplies or equipment to donate?
  • Do you want to produce a COVID-19 related product? – email nbeoc@max.gov.
  • If you are a healthcare provider in need of medical supplies, please contact your state, local, tribal or territory department of public health.
  • Interested in doing business with FEMA and supporting the response to COVID- 19 with your company’s non-medical goods and/or services? Submit your inquiry to the DHS Procurement Action Innovative Response Team at DHSIndustryLiaison@hq.dhs.gov.
  • A list of FEMA regional private sector contacts and state contacts can be found here.
  • President Trump announced that “countries that deny or unreasonably delay the acceptance of their citizens, subjects, nationals, or residents from the United States during the ongoing pandemic caused by SARS-CoV-2, will be subject to ‘visa sanctions’.” (4/10/20)

Department of Justice/Federal Trade Commission/State Attorneys General   Antitrust   

  • On Monday, DOJ issued (4/20/20) its second expedited Business Review Letter (“BRL”) related to COVID-19 collaborations. This BRL, which is consistent with the first expedited BRL, confirms that the DOJ will not challenge AmerisourceBergen’s (a drug wholesaler) collaborative efforts to aid in distributing medications and other health care supplies to assist in responding to the COVID-19 pandemic. AmerisourceBergen is working on numerous issues under the direction of FEMA and HHS to help resolve medical supply challenges, including facilitating the distribution of hydroxychloroquine from the federal government’s National Stockpile (New).
  • DOJ and FTC issued a joint statement reminding companies – especially those in the health care or other essential sectors – of the criminal and civil antitrust risks for colluding or sharing excessive confidential information about employment topics in light of COVID-19 (including changes to salaries/wages/benefits, employment terms, “no poach” agreements, or even invitations to rivals on those topics). Both agencies have been active in the area in recent years following the issuance of guidance in the area in October 2016. (4/13/20)
  • For more information, the A&B Antitrust and Labor & Employment Groups provide a deeper dive to understanding the safeguards businesses should implement to reduce their antitrust risks. (4/17/20)
  • On April 6, Ian Conner, the director of the Federal Trade Commission’s (FTC) Bureau of Competition published a blog post about the importance of the agency “stay[ing] the course” when it comes to antitrust enforcement. In particular, Conner emphasized the FTC will not lower its standards for evaluating who will be effective third-party buyers of businesses or assets required to be divested to resolve FTC merger investigations.
  • DOJ Antitrust Division and Federal Trade Commission (FTC) announced (3/24/20) they will be expediting their usual antitrust business review letter/informal opinion process on competitor collaborations to be done within 7 days (as opposed to the usual many months) of submission of information.
  • The DOJ completed its first Business Review Letter under the new expedited review process on April 4, announcing that “it will not challenge collaborative efforts of McKesson Corporation, Owens & Minor Inc., Cardinal Health Inc., Medline Industries Inc., and Henry Schein Inc. to expedite and increase manufacturing, sourcing, and distribution of personal-protective equipment (PPE) and coronavirus-treatment-related medication.”
  • For more information about this announcement, review this A&B summary (4/6/20).

Consumer Protection   

  • The Federal Trade Commission announced (4/21/20) that it has postponed its workshop seeking input on proposed changes to the Safeguards Rule under the Gramm-Leach-Bliley Act until July 13, 2020 and that the event will be held online. The virtual workshop will address amendments the FTC has proposed making to the Safeguards Rule, which requires financial institutions to develop, implement, and maintain a comprehensive information security program (New).
  • On April 14, the FTC sent warning letters to ten businesses related to their marketing of products which promise to prevent, treat, or cure Coronavirus. The letters, issued to companies and the U.S. and abroad, warn the companies to cease making any unsubstantiated claims. The FDA has previously stated that there currently are no products that are scientifically proven to treat or prevent the virus. These warning letters are the latest to be issued by the FTC, and follow seven FTC-FDA letters announced on March 9 and additional joint warning letters sent since then.
  • On April 13, the Federal Bureau of Investigation (FBI) warned of health care fraud schemes related to COVID-19, including fake testing and treatment schemes.
  • On April 9, the Federal Trade Commission (FTC) provided guidance regarding education technology uses for stay-at-home learning, the importance of protecting student privacy under the Children’s Online Privacy Protection Act (COPPA) as well as the Family Educational Rights and Privacy Act (FERPA) during the coronavirus pandemic.

State Enforcement Actions   

  • On April 14, the Ohio Attorney General filed a lawsuit against an individual from northeast Ohio and his co-conspirators for hoarding N95 respirator masks and selling them online for nearly 18 times the retail price. The hoarding of an item and the related increase in prices of that item (price gouging) constitute an unreasonable and unlawful restraint of trade under the Valentine Act – Ohio’s antitrust law. For guidance and tips on how businesses can respond if they are victims of price gouging, read this A&B advisory. (3/26/20)

Department of Labor/EEOC   

  • Department of Labor (DOL) sent (4/17/20) a letter to Senator Wyden clarifying that independent contractors are eligible for COVID-19 unemployment benefits under the CARES Act (New).
  • DOL announced the first installment of 26 Dislocated Worker Grants (DWGs) totaling $131,384,557 to help address the workforce-related impacts of the coronavirus public health emergency. These awards are funded under the CARES Act, which provided $345 million for DWGs to prevent, prepare for, and respond to coronavirus. (4/15/20)
  • The DOL issued a grant notice to help community-based organizations and public agencies to provide services to migrant and seasonal farmworkers and their dependents. (4/14/20)
  • The DOL issued an updated unemployment insurance program letter explaining to state workforce agencies how to implement unemployment compensation provided for under the CARES Act. (4/10/20)
  • DOL published guidance to states for the implementation of the Pandemic Unemployment Assistance (PUA) program. Under PUA, individuals who do not qualify for regulator unemployment compensation and are unable to continue working as a result of COVID-19, are eligible for up to 36 weeks of PUA benefits. (4/5/20)
  • DOL issued (4/1/20) regulations implementing the paid leave requirements of the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act under the FFCRA.
  • The DOL announced (4/21/20) that it was ending the temporary period of non-enforcement of paid leave protections under FFCRA (New).
  • The State of New York filed (4/14/20) a lawsuit challenging several provisions of this regulation, including the provisions exempting from paid sick leave employees whose employers do not have any work for them, the broad definition of “health care provider,” the provisions regarding intermittent leave, and the documentation requirements for an employee to substantiate leave.
  • The DOL provided FAQs further clarifying paid leave requirements under the new Families First Coronavirus Response Act (FFCRA). (4/6/20)
  • The DOL posted (3/26/20) the required employee notice that must be provided by covered employers to their employees regarding the new paid leave requirements as required by the FFCRA. The posted page contains the link to the poster itself, as well as a new Q&A that focuses exclusively on guidance about posting the notice, particularly in light of the fact that many employees are working remotely.

Occupational Safety and Health Administration   

  • The Occupational Safety and Health Administration (OSHA) issued (4/20/20) guidance for the construction workforce (New).
  • OSHA issued an alert listing safety tips for employers to follow to help protect manufacturing workers from COVID-19 exposure. (4/16/20)
  • OSHA issued new interim guidance to advise compliance safety and health officers to evaluate an employer’s good faith efforts to comply with safety and health standards during the coronavirus pandemic. (4/16/20)
  • OSHA issued its Interim Enforcement Response Plan for Coronavirus Disease 2019 (COVID-19). The April 13 Response Plan is enforcement guidance for OSHA personnel. It applies to all industries but is focused on what OSHA will look for when inspecting hospitals, emergency medical centers, and emergency response facilities. (4/13/20)
  • OSHA issued its Enforcement Guidance for Recording Cases of Coronavirus Disease 2019 (COVID-19). The guidance provides that until further notice, for OSHA recordkeeping and reporting purposes, employers (other than employers in the health care industry, emergency response organizations, and correctional institutions) should consider COVID-19 cases to be “work-related” only where (1) there is objective evidence that the case may be work-related; or (2) where the evidence of work-relatedness “was reasonably available to the employer.” (4/10/20)
  • OSHA issued (4/13/20) guidance for package delivery workers to protect against COVID-19. OSHA previously issued (4/6/20) a workplace poster on how to reduce the risk of exposure to coronavirus.
  • Trying to make sense of all these changes? A&B provides brief overviews of what you need to know:
  • DOL has released additional questions and answers as guidance for the provisions required by FFCRA. A&B provides a complete overview and analysis (4/7/20).

Securities and Exchange Commission   

  • The Securities and Exchange Commission (SEC) announced (4/20/20) that it was issuing two exemptive orders to address the impact of COVID-19 regarding Consolidated Audit Trail (CAT) implementation. The orders are available here and here (New).
  • The SEC announced that it would not recommend enforcement actions for failure to submit Forms 144 in paper if they are emailed instead. (4/10/20)
  • SEC chairman and director of corporation finance released a statement encouraging earning disclosures and reports that timely, accurate, and robust. (4/8/20) The SEC staff released a statement on the same topic on April 14.
  • For additional information on challenges regarding disclosures and COVID-19, review this A&B advisory (4/13/20).
  • The SEC issued updated guidance (4/7/20) on conducting shareholder meetings in light of COVID-19 concerns. Additionally, Delaware issued an executive order (4/6/20) that facilitates companies’ notice of a change in the format of an annual shareholder meeting by allowing notification to stockholders via an SEC filing and press release.
  • For an analysis of changes the Institutional Shareholder Services (ISS) has made to its voting recommendations policies in light of the coronavirus pandemic see this A&B advisory. (4/10/20)

Small Business Administration   

  • Small Business Administration (SBA) – In response to the CARES Act requirements, the SBA formally launched its Paycheck Protection Program (PPP) for small businesses on April 3.
  • The Department of Treasury and SBA released a joint statement summarizing the PPP’s activity: assistance was given to more than 1.6 million small businesses in all 50 states; nearly 5,000 lenders participated; 20% of the amount approved was processed by lenders with less than $1 billion in assets, and approximately 60% of the loans were approved by banks with $10 billion of assets or less; no lender accounted for more than 5% of the total dollar amount of the program; and 74% of the loans were for under $150,000. (4/17/20)
  • The Small Business Administration exhausted the $350 billion funding authorized by the CARES Act which operated on a first come first serve basis as long as the funding lasted. Congressional negotiations continue on an interim relief package including funds to replenish the loan programs funds, and an agreement appears to be near. (4/20/20)
  • The SBA released (4/20/20) reports providing a breakdown of loans and advances under the Economic Injury Disaster Loan program (New).
  • The SBA issued (4/14/20) a report providing a breakdown by industry, state, and loan size for the more than one million loans totaling over $247 billion approved through April 13.
  • The SBA has guidance (4/1/20) for loans under the Paycheck Protection Program, the Express Bridge Loan Pilot Program, the Economic Injury Disaster Loan Program for qualified entities that are impacted by COVID-19. The application for its economic injury federal disaster loans can be found here.
  • The SBA, in consultation with the Treasury Department, updated its published FAQs addressing the Paycheck Protection Program. (Updated 4/8/20)
  • The SBA released the interim final rule (4/2/20) implementing the Paycheck Protection Program.
  • Complete details on each of the SBA CARES Act programs can be found here.
  • For a deeper dive on the funding streams available for SBA loans in the CARES Act, review this A&B publication (4/1/20).
    • Treasury and the SBA issued an interim final rule (4/14/20) on how self-employed and independent contractors can apply for PPP loans.
  • For information on how fund managers can qualify for relief, review this A&B advisory. (4/14/20)
  • A&B’s Financial Restructuring & Reorganization Group has provided proactive steps creditors can take now to prepare for whatever comes after the coronavirus pandemic subsides in this advisory (4/9/20). For more on how the CARES Act impacts the banking industry, including takeaways for lenders and on regulatory relief and mortgage-related provisions, read this A&B advisory (3/30/20).

Department of Treasury/IRS/Federal Reserve   

  • The Department of Treasury website for CARES Act programs, including specific sections on assistance for American workers and families, small businesses, state and local governments, and preserving jobs for American industry.
  • The Department of Treasury and Internal Revenue Service (IRS) announced (4/21/20) cross-border tax guidance related to travel disruptions. These include guidance regarding determining U.S. tax residency, guidance on qualification for exclusions from gross income, and an FAQ for nonresident aliens and foreign corporations on prolonged presence in the U.S. due to COVID-19 (New).
  • The Department of Treasury announced (4/20/20) Payroll Support Program agreements with Allegiant Air, American Airlines, Delta Air Lines, Southwest Airlines, Spirit Airlines, and United Airlines and announced that several other airlines planned to participate (Alaska Airlines, Frontier Airlines, Hawaiian Airlines, JetBlue Airways, and SkyWest Airlines) (New).
  • The Federal Reserve announced the Paycheck Protection Program Liquidity Facility (PPPLF) is fully operational and available to provide liquidity to eligible financial institutions. (4/16/20)
    • The PPPLF supports the effectiveness of the PPP by extending credit to financial institutions that make PPP loans. The Federal Reserve has also published a FAQ regarding this facility.
  • The Department of Treasury launched the “Get My Payment” free web app which allows taxpayers who filed their tax return in 2018 or 2019 but did not provide their banking information on their return to submit direct deposit information. Once completed, they will get their $1,200 Economic Impact Payments direct deposit to their bank accounts (plus $500 for minor children), a process expected to begin on April 20. “Get My Payment” will also allow taxpayers to track the status of their payment. Guidance is also provided for non-filers of tax returns in 2018 or 2019. (4/15/20)
    • The Social Security Administration announced that Supplemental Security Income (SSI) recipients will automatically receive their Economic Impact Payments directly to their bank accounts or by paper check, just as they would normally receive their SSI benefits. (4/15/20)
    • The Department of Treasury and the IRS announced that Social Security beneficiaries who are not typically required to file tax returns will not need to file an abbreviated tax return to receive an Economic Impact Payment. Instead, payments will automatically be deposited into their bank accounts. (4/8/20)
    • The Treasury Department provided the details on the Economic Impact Payments program up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child. This program was also required by the CARES Act. (4/6/20)
  • Ginnie Mae announced an expansion of its issuer assistance program to help mortgage servicers facing liquidity shortfalls to apply for assistance in meeting their contractual obligations. (4/10/20)
  • The APM introduces a new version of the existing Pass-Through Assistance Program (PTAP) for use by issuers facing a temporary liquidity shortfall directly attributable to the COVID-19 National Emergency. The existing PTAP program had been tailored to natural disaster situations with more limited impact.
  • For more details on how Ginnie Mae will be implementing the Pass-Through Assistance Program during the coronavirus pandemic, see this A&B advisory (4/16/20).
  • The Federal Reserve announced (4/9/20) that it will launch a lending program for mid-sized businesses hurt by the coronavirus, called the Main Street Lending Program. The new program will provide up to $600 billion in loans to eligible businesses through two facilities.
  • A brief overview and comparison of the two Main Street programs can be found here.
  • For more information about the Main Street programs, review this A&B advisory. (4/14/20)
  • The Federal Reserve provided details for the provision of up to $2.3 trillion in loans to support the economy on April 9 and term sheet details can be found here. (4/9/20)
  • The Internal Revenue Service (IRS) issued Revenue Procedure 2020-26, which provides safe harbors for payment forbearances (and “related modifications”) arising from the COVID-19 emergency on mortgage loans held by real estate mortgage investment conduits (REMICs) and investment trusts and on mortgage loans contributed to REMICs. (4/13/20)
    • For a deeper dive on this topic, see this A&B advisory (4/15/20).
  • Responding to requests for relief from the Real Estate Roundtable and others, the IRS issued Revenue Procedure 2020-23on April 8 to address technical issues that would have limited the ability of partnerships and their partners to benefit from retroactive CARES Act provisions.
  • For a deeper dive on this topic, see this A&B advisory (4/9/20).
  • The Consumer Financial Protection Bureau (CFPB), Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) issued an interagency statement regarding an interim final rule to temporarily defer real estate appraisals and evaluations for up to 120 days after closing through. (4/14/20)
  • The Department of Treasury, Federal Reserve, and FDIC jointly announced an interim final rule to encourage lending to small businesses through the SBA’s Paycheck Protection Program (PPP). (4/9/20)
  • The CFPB, Federal Reserve, FDIC, the National Credit Union Administration (NCUA), the OCC, and state banking regulators issued (4/3/20) a joint statement on supervisory and enforcement practiced regarding mortgage servicing rules regarding COVID-19 and the CARES Act. For additional details on the joint statement, review this A&B advisory (4/6/20).
  • Treasury and SBA jointly announced that the interest rate on what lenders could charge small businesses for loans in the Paycheck Protection Program would be raised from 0.5% to 1%. (4/2/20)
  • In a joint statement (3/22/20), the federal financial institution regulatory agencies and state banking regulators encouraged financial institutions to work constructively with borrowers affected by COVID-19 and provided additional information regarding loan modifications.
    • The federal financial institution regulatory agencies issued a revised interagency statement providing additional information regarding loan modifications on April 7.
  • To understand how federal regulators are clarifying the CARES Act interaction with previous statements on loan modifications and reporting read this A&B advisory. (4/9/20).
  • The IRS granted further COVID-19 emergency relief in Notice 2020-18 (superseding its prior announcement) delaying the due date for filing Federal income tax returns and making Federal income tax payments from April 15, 2020 to July 15, 2020. The deadline is automatically postponed with no need for taxpayers to file Forms 4868 or 7004. Unlike prior guidance, there is no limitation on the amount of tax payments that may be deferred until July 15, 2020. Read here for both economic impact payments and "what you need to know" (updated 4/1/20) and for additional guidance and FAQs.
  • The CARES Act allows employers to defer the deposit and payment of the employer's share of social security taxes and self-employed individuals to defer payment of certain self-employment taxes through December 31, 2020. These FAQs address specific issues related to the deferral of deposit and payment of these employment taxes. (4/9/20)
    • Economic impact payments for non-filers, but full details are here.
    • The IRS extended additional tax deadlines for estates, individuals, and businesses until July 15, 2020. As a result, the extensions generally now apply to all taxpayers that have a filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020.
  • The CARES Act provides a refundable tax credit for businesses of all seizes that experience economic hardship due to COVID-19. Click here for A&B’s guide to how the credit works.

Other Agencies   

  • Department of Education (DOEd) announced (4/21/20) that it was making more than $6 billion available to colleges and universities to provide direct emergency cash grants to students under the CARES Act. The DOEd also released an FAQ on these grants (New).
    • The Department of Education announced that over $3 billion in block grants would be provided to state governors under the CARES Act for K-12 education. (4/14/20)
    • DOEd announced on April 14 that career and technical education (CTE) programs can donate or loan personal protective equipment (PPE) and other medical supplies purchased with federal funds to public health agencies, private nonprofit hospitals, and other licensed health care providers to support the nationwide coronavirus response effort.
    • DOEd announced on April 9 that more than $6 billion will be distributed immediately to colleges and universities to provide direct emergency cash grants to college students whose lives and educations have been disrupted by the coronavirus pandemic. Additional details can be found in this FAQs on Dept. of Education grant funds.
  • The Department of Housing and Urban Development (HUD) announced (4/21/20) that it had issued a notice awarding $1.5 million in funding to support fair housing activities during COVID-19 (New).
  • Department of Energy has updated its FAQs from the Office of Cybersecurity, Energy Security, and Emergency Response (CESER). (4/16/20)
  • Department of State provided an update on COVID-19 impact and assistance for American citizens abroad. (4/16/20)
  • Department of Transportation (DOT): On April 10, DOT announced the Agency was making over $1 billion available to the National Railroad Passenger Corporation (Amtrak) to support the railroad’s activities to respond to, prepare for, and prevent the spread of COVID-19.
  • DOT issued (4/7/20) a new rule regarding minimum service requirements and exemptions for airlines receiving financial assistance under the CARES Act.
  • The Federal Aviation Administration announced (4/14/20) the award of $10 billion in funds under the CARES Act for U.S. airports. A breakdown of the funding by airport is available here. The FAA updated its FAQs on these grants.
    • It was reported (4/14/20) that the FAA is banning pilots from taking chloroquine or hydroxychloroquine, two drugs the President has suggested are effective against the coronavirus, for 48 hours before flying.
  • Department of Veterans Affairs (VA): President Trump issued an executive order on April 10, directing the Department of Veterans Affairs to allow flexibility in federal contracts for “national security reasons.”

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

  • Senators press Lighthizer to suspend Section 301 tariffs on key medical products. S. Trade Representative Robert Lighthizer should “immediately and broadly” lift Section 301 tariffs on imports needed to manufacture medical products being used to combat the coronavirus outbreak, Sens. Tom Carper (D-DE) and Pat Toomey (R-PA) said on Monday. USTR last month launched a process allowing members of the public, businesses, and government agencies to submit Section 301 tariff-exclusion requests for coronavirus-related medical products. The agency has since granted some exclusions, with nearly 500 comments submitted to the coronavirus docket as of Tuesday. Carper and Toomey wrote in an April 17 letter to Lighthizer that while they “appreciate” the actions USTR has taken so far, there is “an extreme shortage of critical medical supplies needed to respond to the COVID-19 pandemic, including hand sanitizer, nasopharyngeal swabs, facemasks, ventilators, isolation gowns, and more.” (New)
  • Importers Call for Broader Tariff Deferrals. Importers hailed the temporary duty deferral announced April 19, even as many said applying it to Section 301 is also needed. Apparel faces some of the highest Most Favored Nation tariffs, which is the only category the duty deferral applies to. American Apparel and Footwear Association CEO Steve Lamar said: “Deferring duty payments and import fees in a time of limited liquidity is a welcome move. As revenue has receded due to closed stores and less commerce, American companies have been faced with the difficult decision to pay their tariff bill to the U.S. government or keep American workers on payroll. The deferral of these payments will provide some of the liquidity needed to keep more Americans employed and more American companies operational during this crisis.” He said, however, that Section 301 duties should be included. (New)
  • CBP COVID-19 – 90 Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees. On April 20, the Secretary of the Treasury and U.S. Customs and Border Protection (CBP) will be postponing for 90 calendar days the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers experiencing a significant financial hardship due to the coronavirus disease (COVID-19). This temporary postponement applies to formal entries of merchandise entered, or withdrawn from warehouse, for consumption (including entries for consumption from a Foreign Trade Zone) in March 2020 or April 2020. CBP will not return deposits of estimated duties, taxes, and fees that have already been paid. (New)
  • The Office of Foreign Assets Control (OFAC) Encourages Persons to Communicate OFAC Compliance Concerns Related to the Coronavirus Disease 2019 (COVID-19). On April 16, OFAC published a fact sheet that summarizes existing exemptions and authorizations to provide humanitarian assistance in the context of the Iran, Venezuela, North Korea, Syria, Cuba, and Ukraine/Russia-related sanctions programs. Separately, OFAC encourages (4/20/20) persons, including financial institutions and other businesses, affected by the COVID-19 global pandemic to contact OFAC as soon as practicable if the person believes it may experience delays in its ability to meet deadlines associated with regulatory requirements administered by OFAC. This includes requirements related to filing blocking and reject reports within ten business days, responses to administrative subpoenas, reports required by general or specific licenses, or any other required reports or submissions (New)
  • S. Asks China to Revise Increased Export Restrictions on Medical Supplies. The U.S. has asked China to amend its increased export control inspections that are causing delays of medical supply shipments, according to a State Department spokesperson. “We appreciate the efforts to ensure quality control. But we do not want this to serve as an obstacle for the timely export of important supplies,” the spokesperson said in an April 17 statement. The spokesperson added that the U.S. has “raised these concerns” with China and requested that it “revise its new requirements to allow the expeditious export of vital [personal protective equipment] to the United States.” The U.S. is working “closely” with U.S. companies exporting medical supplies from China to help them “understand the new regulations and raise concerns about held-up shipments,” the spokesperson said.
  • ITC COVID-19 Related Goods: U.S. Imports and Tariffs; Institution of Investigation. Following receipt on April 7, of a request from the House Committee on Ways and Means and the Senate Committee on Finance, under section 332(g) of the Tariff Act of 1930, the U.S. International Trade Commission instituted Investigation No. 332–576, COVID–19 Related Goods: U.S. Imports and Tariffs, for the purpose of providing a report that identifies imported goods related to the response to COVID-19, their source countries, tariff classifications, and applicable rates of duty. See the FR Notice here.
  • A&B European Antitrust, Mergers & Acquisitions, and International Trade & Regulatory Groups examines (4/21/20) changes in the way European competition authorities will review foreign direct investment during (and potentially long after) the coronavirus pandemic and reviews what COVID-19 may mean for European commercial mortgage-backed securities servicers (New).
  • A&B’s International Tax Group investigates the nuances of regulations from U.S. and international agencies and offers useful guidance from the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations and actions enterprises can take now to prepare for the tax implications of COVID-19-related disruptions in this advisory (4/16/20).

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. (last update 4/19/20)
  • On April 14, the California Insurance Commissioner issued a Notice requiring all “insurance companies to fairly investigate all business interruption claims caused by COVID-19.”  April 17, the California Department of Insurance hosted a “Small Business Tele-TownHall” addressing issues including the availability of insurance coverage for COVID-19 related business interruption claims. The Commissioner purportedly encouraged all business owners impacted by the COVID-19 pandemic to submit claims for business interruption coverage, if they haven’t done so already, noting that not all policies are the same and insurers have an obligation to fully investigate all claims (New).
  • On April 17, North Carolina Insurance Commissioner Mike Causey sent a letter to business owners explaining that the “issue with commercial property insurance, specifically business interruption insurance, presents a . . . difficult problem.” He explains that “[s]tandard business interruption policies are not designed to provide coverage for viruses, diseases, or pandemic-related losses because of the magnitude of potential losses.” Finally, the Commissioner notes that paying business interruption claims for COVID-19 related claims “could cripple the insurance industry causing many companies to fail, which would put the protection of homes, automobiles, and businesses at risk.” Therefore, the North Carolina Department of Insurance has advised that it cannot “legally force insurers to cover a risk which they didn’t intend to cover” but that they are “looking for ways to protect businesses in the future.”
  • On April 15, the Pennsylvania Senate introduced Senate Bill 1114, which if passed would mandate that all policies insuring against loss related to property damage “shall be construed to include among the covered perils coverage for loss or property damage due to COVID-19 and coverage for loss due to a civil authority order” related to the COVID-19 pandemic. The bill provides that Insureds classified as small business would receive 100% of the policy limit for eligible claims. All other businesses would receive 75% of the policy limit for eligible claims. The act would apply to all policies in effect prior to March 6, 2020. The Senate Bill follows a similar bill introduced by the Pennsylvania house, as well as bill introduced in South Carolina, Rhode Island, Louisiana, New York, New Jersey, Massachusetts, and Ohio. Note that New Jersey’s bill was pulled from consideration prior to the General Assembly vote.
  • On April 14, US Congressman Mike Thompson (CA-05) announced the introduction of R. 6494, the Business Interruption Insurance Coverage Act of 2020. The bill has bipartisan support and, if passed, would require each insurer “that offers or makes available business interruption insurance coverage” to “make available, in all of its policies providing business interruption insurance, coverage for losses resulting from . . . any viral pandemic . . . any forced closure of businesses, or mandatory evacuation . . . or . . .any power shut-off conducted for public safety purposes.” The bill further provides that any exclusions in force on the date of the enactment of the act “shall be void. to the extent” they exclude the above-specified losses. Policy exclusions may be reinstated if authorized in writing by the insured or if the insured fails to pay any increased premium charged by the insurer for providing the business interruption coverage. Insurers must provide 30 days’ notice of the increased premium or reinstatement of the exclusions.
  • On April 13, Representative Pramila Jayapal (WA-07) sent a letter to the CEOs of several insurance companies expressing “concern about reports that commercial insurance companies are declining to cover COVID-19 related claims filed by small and medium-sized businesses.” She further wrote that she believes “that commercial insurance companies should honor all clearly covered coronavirus-related losses; work closely with the office of state Attorneys General to resolve disputes; and set up accessible means by which policyholders can get answers on their coverage and resolve disputes quickly without having to resort to time-consuming and expensive litigation.”
  • Litigation relating to business interruption coverage in the wake of the COVID-19 pandemic and related civil authority orders is picking up steam. More than two dozen lawsuits have been filed against insurers in both state and federal courts. These lawsuits consist of both declaratory judgment actions seeking clarification as to whether policy terms will cover COVID-19 related business interruption claims as well as actions seeking damages for breach of insurance contract and bad faith. Notably, there has been a stark increase in the number of class action lawsuitsMeanwhile, at least one insurer—Travelers—has filed suit against an insured seeking a declaration that it does not have an obligation to pay COVID-19 related business interruption claims. Finally, several plaintiffs have asked the Judicial Panel on Multidistrict Litigation to establish an MDL to consolidate nationwide COVID-19 related business interruption coverage lawsuits. Notable filings include: (New)
    • Travelers Casualty Insurance Company v. Geragos & Geragos, 2:20-cv-3619 (C.D. Cal.) (Insurer seeks declaration that it is not obligated to pay COVID-19 related business interruption claims).
    • Troy Stacy Enterprises Inc. v. The Cincinnati Insurance Company, 1:20-cv-312 (S.D. Ohio, filed 4/19/20) (Class Action. Plaintiffs allege wrongful denial of business interruption coverage relating to COVID-19 closures on behalf of nationwide “business income coverage,” “civil authority coverage,” “extra expense coverage” and “sue and labor” coverage damages and declaratory judgment classes).
    • Newchops Restaurant Comcast LLC v. Admiral Indemnity Company, 2:20-cv-1949 (E.D. Pa., filed 4/17/20) (Pending MDL transfer. Plaintiff seeks declaration that policy covers business interruption losses due to COVID-19 and that the policy’s virus and bacteria exclusions do not apply because coverage was triggered by civil authority orders).
    • PGB Restaurant Inc. v. Erie Insurance Company, 1:20-cv-2403 (N.D. Ill., filed 4/19/20) (Class action. Plaintiffs allege insurer wrongfully denied plaintiffs’ claims for lost business income due to the COVID-19 pandemic. Plaintiff seeks relief on behalf of a class of all similarly situated Illinois businesses).
    • Several similar federal class actions have been filed in district courts in Florida, Wisconsin, Ohio, California, and New York.  Those cases include: Café International Holding Company LLC v. Chubb Limited; Westchester Surplus Lines Insurance Co., 1:20-cv-21641 (S.D. Fla.) (Class Action – Nationwide class); Rising Dough Inc. v. Society Insurance, 2:20-cv-623 (E.D. Wis.) (Class Action – Nationwide class); Bridal Expressions LLC v. Owners Insurance Company, 1:20-cv-833 (N.D. Ohio) (Class Action – Nationwide class); GIO Pizzeria & Bar Hospitality LLC v. Lloyds London, 1:20-cv-3107 (S.D.N.Y.) (Class Action – Nationwide class); Caribe Restaurant & Nightclub v. TOPA Insurance Company, 2:20-cv-3570 (C.D. Cal.) (Class Action -Nationwide class); and Christie Jo Berkseth-Rojas v. Aspen American Insurance Company, 3:20-cv-948 (N.D. Tex.) (Class Action – Nationwide Class). Many of these are included in recently filed requests to consolidate into an MDL.
    • Several similar lawsuits have been filed in Texas, Alabama, California, Wisconsin, and Pennsylvania state courts.  Those cases include: Lombardi’s Inc. v. Indemnity Insurance Co. of America, DC-20-05751-A (Dallas County District Court, Texas); Founder Institute Incorporated v. Hartford Fire Insurance Company, T20-873 (Santa Clara County Superior Court); Tambellini Inc. v. Erie Insurance Exchange, GD-20-005137 (Allegheny County Court of Common Pleas, filed 4/17/20); The Inns by the Sea v. California Mutual Insurance Company, T20-90 (Monterey County Superior Court); Colectivo Coffee Roasters Inc. v. Society Insurance, 2020-cv-002597 (Milwaukee County Circuit Court) (Class Action); PTG Live Events LLC v. The Cincinnati Insurance Company, 2020-cv-002596 (Milwaukee County Circuit Court) (Class Action); Ascent Hospitality Management Company LLC v. Employers Insurance Company of Wausau; Liberty Mutual Insurance Company, 01-cv-20-90144 (Jefferson County Circuit Court); and Pez Seafood DTLA LLC v. The Travelers Indemnity Company (Los Angeles Superior Court Central District).

Additional Workplace (Stay-at-Home) Issues   

  • Government Closure/Stay-at-Home orders have been released in multiple state and local jurisdictions. For the key Stay-at-Home order details in one document, view this A&B COVID-19 50-State Closure Tracker: Part I (A-M) and Part II (N-Z). (Updated 4/20/20)
  • Review this A&B advisory (4/21/20) to learn more about how shelter-in-place orders and the continuing economic stoppage is likely to trigger both monetary and covenant defaults of countless obligors under CMBS, bridge, construction, and agency loans over the next several months. (New)
  • The COVID-19 pandemic has forced a greater awareness of force majeure clauses in commercial leases and it has been essential to have a good foundation of the basics which can be found in this A&B guide to force majeure basics. (4/17/20)
  • The CDC released guidance advising that critical infrastructure workers may be permitted to continue work following potential exposure to COVID-19, provided they remain asymptomatic and additional precautions are implemented to protect them and the community. (4/9/20)
  • Following the CDC’s recommendation of wearing face coverings as “additional, voluntary public health measure,” we are seeing a trend of local government orders mandating the use of facemasks or cloth face coverings in public and/or the workplace.

Cyber Security & Privacy   

  • The Federal Trade Commission issued recommendations for businesses on how to reduce privacy and data security risks while video conferencing. These tips range from limiting participants, to establishing preferred video conferencing business practices, to carefully checking that links are not security threats before sharing or clicking on them. (4/16/20)
  • The United States Senate held a “paper hearing” on using big data in the fight against COVID-19. Opening statements and questions are available here. (4/9/20)
  • Governments world-wide are using location and other mobile device data to slow the spread of COVID-19. We analyze these efforts in this A&B advisory. (4/13/20)
  • The U.S. Department of Homeland Security (DHS) Cybersecurity and Infrastructure Security Agency (CISA) and the United Kingdom’s National Cyber Security Centre (NCSC) issued a joint alert regarding COVID-19-related themes malicious cyber actors are using to attack vulnerable services and exploit COVID-19. The alert explains how malicious actors are making their attacks as well as steps businesses can take to protect themselves. (4/8/20)
  • The COVID-19 pandemic provides an opening for a variety of malicious cyber-attacks. The FBI details threats and ways to protect yourself. (4/1/20)
    • This A&B advisory (4/7/20) discusses the current COVID-19 cybersecurity threat landscape, including scams that target individuals, attempts to compromise company systems, telework vulnerabilities, and business email compromise.

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