On Friday, October 2, the U.S. Department of Health & Human Services (HHS) announced that the Public Health Emergency (PHE) declaration for COVID‑19 will be renewed for another 90 days, beginning on October 23 (the date the PHE was previously scheduled to expire) and extending through January 20, 2021.
This update enumerates the key regulatory flexibilities and funding sources that are linked to the PHE, as well as key emergency measures with independent timelines that are not directly affected by the PHE renewal.
HHS declared COVID‑19 to be a public health emergency effective January 27, 2020. This PHE declaration activated certain emergency authorities under Section 319 of the Public Health Service Act, including the ability to issue grants and enter into contracts to investigate COVID‑19 causes, treatments and prevention. In its multiple COVID-19 relief bills, Congress also tied various Medicare and Medicaid provisions to the PHE, and HHS has since issued interim final rules tying various administrative flexibilities to the PHE. Although PHE declarations expire automatically after 90 days, HHS has consistently exercised its authority to renew the PHE.
These expiration and renewal timelines are closely watched by the healthcare industry and state governments because dozens of COVID-19-related emergency measures are scheduled to sunset when the PHE expires. In the past, HHS has typically held off issuing a renewal declaration until mere days before the automatic expiration date, a practice that raised questions and concerns about the possibility of stakeholders needing to rapidly unwind dozens of crucial flexibilities. (See, for example, this letter from the Medicaid and CHIP Payment and Access Commission (MACPAC).)
This time, HHS issued its renewal declaration a full three weeks in advance of the scheduled expiration date. The early renewal provides some measure of comfort, although industry stakeholders should bear in mind that HHS retains the discretion to terminate the PHE at any time.
The following sections review certain key regulatory flexibilities and emergency funding sources that are—and are not—linked to the PHE.
Emergency Measures That Are Linked to the PHE
- 1135 Waivers. Section 1135 of the Social Security Act authorizes HHS to modify certain federal healthcare requirements during an emergency to ensure sufficient access to services for Medicare and Medicaid beneficiaries, and to protect providers against penalties for good faith attempts to deliver services in emergency conditions. (See here for Manatt’s primer on the 1135 authority.) HHS and the Centers for Medicare & Medicaid Services (CMS) have issued dozens of nationwide “blanket” waivers and state-specific Medicaid waivers that, among other things, enhance providers’ ability to establish alternative sites of care or practice across state lines, expand Medicare telehealth coverage, and suspend many federal oversight and reporting requirements.
- In general, these waivers may remain in effect for only so long as there exist both (1) a PHE declared by HHS and (2) a presidential declaration under either the National Emergencies Act (NEA) or the Stafford Act. Both conditions were satisfied effective March 1, per the President’s NEA declaration. As of the time of writing, the NEA declaration remains in effect, as do several declarations under the Stafford Act (described below).
- Waivers that broaden Medicare telehealth coverage last until the end of the PHE whether or not a qualifying presidential declaration remains in effect, pursuant to amendments made in the Coronavirus Preparedness and Response Supplemental Appropriations Act that Congress passed on March 6, 2020.
- CMS Interim Final Rules With Comment Period (IFCs). CMS’s three IFCs—effective March 31, May 8 and September 2, 2020—modify numerous Medicare and Medicaid rules regarding, for example, Medicare coverage of telehealth, supervision of medical residents, Medicare and Medicaid diagnostic testing, provider-based hospital departments, and the Medicare Shared Savings Program (MSSP). The IFCs also introduce a number of new requirements regarding COVID-19 testing and reporting, particularly with respect to long-term care facilities. Most of the IFCs’ regulatory changes are temporary and will expire at the end of the PHE. (Manatt’s coverage of the March 31 IFC is available here.)
- Certain Measures Under the COVID-19 Response Legislation. The Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act each enacted numerous flexibilities and funding sources, many of which are linked to the PHE. (Manatt has previously issued summaries of both FFCRA and the CARES Act.)
- The PHE-linked measures that are particularly relevant for healthcare providers include enhanced coverage and waived cost sharing for COVID-19 tests and vaccines across payors, increased Medicare reimbursement for COVID-19-related hospital discharges, and loosened restrictions related to post-acute care facilities.
- With respect to Medicaid, FFCRA’s 6.2 percentage point boost to the federal Medicaid match rate remains in effect through the end of the calendar quarter in which the PHE expires, which would now be March 31. The same end date applies to the “maintenance of effort” requirement that prohibits restrictive new eligibility measures, as well as the mandate for states to cover, without cost sharing, any FDA-authorized COVID‑19 test, treatment or vaccine. Meanwhile, the so-called continuous coverage requirement—which prohibits state Medicaid agencies from disenrolling any beneficiaries—lasts until the end of the month in which the PHE expires.
- The optional Medicaid eligibility group that states may adopt to expand coverage for testing and testing-related services to uninsured individuals (without regard to income) terminates at the end of the PHE.1
- Certain State Medicaid and CHIP Operational Flexibilities. In response to COVID-19, CMS has allowed states to rapidly implement various time-limited changes to their Medicaid programs and Children’s Health Insurance Programs (CHIP). Many of these changes will expire at the end of the PHE or shortly thereafter, including program modifications implemented via a Disaster Relief State Plan Amendment (SPA) or COVID-19 1115 demonstration project.2
- HIPAA Enforcement Discretion. The HHS Office of Civil Rights (OCR) has issued guidance relaxing certain federal HIPAA privacy and security rules during the PHE, including with respect to permissible telehealth technologies and community-based testing sites. (See Manatt’s summary here.)
- Fraud and Abuse Enforcement Discretion. The HHS Office of Inspector General (OIG) has issued guidance condoning, for the duration of the PHE, certain COVID-19 response activities that might otherwise raise concerns under the Anti-Kickback Statute or the Physician Self-Referral Law (commonly referred to as the “Stark Law”). (Note that CMS has also suspended several Stark Law restrictions using 1135 waivers, as described above.)
- Flexibility Regarding Controlled Substances. The U.S. Drug Enforcement Administration (DEA) and the HHS Substance Abuse and Mental Health Services Administration (SAMHSA) have issued guidance allowing various flexibilities for Opioid Treatment Programs (OTPs) and other prescribers of controlled substances during the PHE, including with respect to “take-home” doses and telehealth-based assessments and counseling.
Emergency Measures That Are Not Linked to the PHE
- The President’s Stafford Act Declarations. These declarations authorize the Federal Emergency Management Agency (FEMA) to disburse disaster relief funds. In addition to a nationwide emergency declaration on March 13, the President has issued state-by-state major disaster declarations. These declarations all remain in effect as of the time of writing. FEMA will eventually declare an end to the “incident period” related to COVID-19, which will establish the time period during which certain types of expenses will be reimbursed.
- Emergency Use Authorizations (EUAs). Under Section 564 of the Federal Food, Drug, and Cosmetic (FD&C) Act, the U.S. Food and Drug Administration (FDA) may issue EUAs that temporarily authorize unapproved medical products. EUAs may be granted in response to a public health emergency that, as determined by HHS, has significant potential to affect national security or the health and security of U.S. citizens living abroad. With respect to COVID-19, HHS deemed that a qualifying public health emergency existed as of February 4, a determination that appeared to be separate from HHS’s January 27 PHE declaration under the Public Health Service Act.
- Certain Measures Under the COVID-19 Response Legislation. Certain measures in FFCRA, the CARES Act, and the Paycheck Protection Program and Health Care Enhancement Act are not expressly linked to the PHE, including disbursements through the Paycheck Protection Program (PPP) and permanent changes to the “Part 2” rules that govern the confidentiality of information held by certain substance use disorder (SUD) programs. It is possible, however, that the PHE could factor into implementation and audit protocols with respect to these programs. (See Manatt’s webinar discussing lessons learned regarding the PPP and summary of the altered SUD confidentiality standards.)
- The HHS Public Readiness and Emergency Preparedness (PREP) Act. HHS’s PREP Act declaration, which went into effect February 4, shields certain individuals and entities from liability with respect to the manufacture, distribution, administration or use of certain “medical countermeasures,” defined in an advisory opinion as FDA-authorized drugs, devices and biological products used to diagnose, treat or prevent COVID-19. This liability does not extend to willful misconduct. HHS has, in addition, authorized pharmacists in all states to order and administer COVID-19 tests and certain pediatric vaccines, notwithstanding any limitations that may exist under state laws on scope of practice. HHS’s PREP Act declaration is currently scheduled to expire in October 2024 unless terminated earlier.
Stakeholders Should Plan for a Post-PHE World
HHS’s decision to renew the PHE well in advance of its scheduled expiration date gives healthcare stakeholders some measure of certainty as we head into 2020’s final months—months that will usher in colder weather, seasonal influenza, and perhaps FDA authorization for one or more COVID‑19 vaccines. Stakeholders should bear in mind, however, that the PHE will not last forever, and may not be renewed past the current January 20 end date. In the meantime, HHS and CMS may continue their recent trend of gradually reinstating oversight requirements one at a time (as described by Manatt here).
Stakeholders are thus advised to continue planning for the eventual wind-down of the many flexibilities that will sunset in tandem with the PHE. State Medicaid programs, for example, must be prepared to process eligibility redeterminations and regular renewals.3 For healthcare providers, the end of the PHE could mean a sudden resumption of full enforcement with respect to Medicare and Medicaid Conditions of Participation, the HIPAA privacy and security rules, and federal laws governing fraud and abuse. Advocacy efforts are already underway to preserve certain emergency flexibilities on a permanent basis following the end of the PHE, but it remains to be seen which policies will ultimately be codified in new legislation or agency policy.
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A chart summarizing the current effective and end dates of all the flexibilities listed above is available through Insights@ManattHealth—a premium subscription service designed to help healthcare stakeholders keep up with the latest developments and benefit from in-depth analyses critical to their business. The content leverages Manatt Health’s legal and policy expertise in the Medicaid, Medicare, Marketplace, life sciences, litigation, digital health and privacy spaces and includes:
- Manatt’s weekly memo, “Insights This Week”: a roundup of the week’s federal and state policy changes
- Regulatory and guidance summaries: detailed summaries of Medicaid, Medicare and Marketplace regulatory and subregulatory guidance, as well as synopses of healthcare litigation developments
- 50-state surveys: deep dives of the latest trends in healthcare, including 1115 coverage waivers, 340B policies and telehealth
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1 Although federal funding for the optional eligibility group ends at the end of the PHE, states may need to keep this group enrolled (without coverage) until the end of the month in which the PHE period ends in order to comply with FFCRA’s continuous coverage requirement, as explained in CMS guidance.
2 Medicaid Disaster Relief SPAs expire at the end of the PHE. CHIP Disaster Relief SPAs may continue past the end of the federal PHE if a qualifying state emergency declaration remains in place. COVID-19 1115 demonstration projects terminate, at the latest, 60 days following the end of the PHE. Manatt’s overview of approved COVID-19 Section 1115 demonstrations is available here.
3 Manatt Health has developed resources (here and here) to guide states as they plan for a post-PHE wind-down of emergency flexibilities. These resources were developed with support from the State Health and Value Strategies (SHVS) program, a grantee of the Robert Wood Johnson Foundation.