Update on the Federal Response to the COVID-19 Pandemic as Leadership Changes

COVID-19 was the top focus of the new federal administration as it entered office this month. With the surge in cases continuing across the nation, President Joseph Biden signed a number of COVID-19 related executive orders upon entering office and has also outlined his plan for the future. Additionally, the Centers for Medicare and Medicaid Services (CMS) has continued to issue new guidance and approve new waivers over the last several weeks.

This article includes information about each of these developments and resources, as well as key provisions that were signed into law at the end of 2020 as part of the 2021 appropriations bill. As always, with information and policy evolving regularly, we encourage readers to stay on top of the latest updates on these topics and others, including clinical guidance, at https://www.hhs.gov/about/news/coronavirus/index.html.

Emergency Declaration Renewal

One of Department of Health and Human Services (HHS) Secretary Alex Azar’s final acts was to once again renew the COVID-19 federal public health emergency declaration, on January 7th, 2021. This declaration is important to ensure the ongoing applicability of the temporary flexibilities that HHS has granted – both nationwide and within state-specific Section 1135 Waivers.

Executive Orders and the American Rescue Plan

Prior to entering office, President Biden issued the American Rescue Plan, which, in regards to healthcare, would:

  • Create a national vaccination program and increase the federal Medicaid assistance percentage (FMAP) to 100 percent for the COVID-19 vaccine
  • Enhance testing and contact tracing and invest in treatments and supplies
  • Create a public health jobs program
  • Expand healthcare coverage, including through temporary COBRA subsidies and expanded and enhanced premium tax credits
  • Increase funding for veterans’ health, as well as substance use and behavioral health services
  • Address health disparities related to COVID-19

Upon entering office, the President took quick action issuing several COVID-19-related Executive Orders:

These Executive Orders address key healthcare-related topics, including:

  • Access to COVID-19 testing (including insurance coverage of testing);
  • expansion of the public health workforce;
  • ensuring an adequate healthcare workforce and access to treatments;
  • creation of a COVID-19 Equity Taskforce to advance an equitable response to COVID-19, including efforts related to contact tracing and vaccination; and
  • expanding access to healthcare coverage during the economic crisis through Special Enrollment Periods (SEPs).

As with all Executive Orders, these orders largely direct activity and priorities of federal agencies rather than enacting policy change themselves. However, in follow-up to the Executive Order on SEPs, CMS announced an SEP in response to the public health emergency that will run from February 15th through May 15th of this year.

CMS Guidance

 As in past months, CMS continues to release guidance at the agency level. With the COVID-19 vaccine rolling out across the country, CMS updated its Toolkit on the COVID-19 Vaccine for health insurance issuers including Medicare Advantage Plans at the beginning of January. The toolkit was released to assist issuers and Medicare Advantage plans to identify and address potential issues related to vaccine administration, with a focus on vaccine administration since the vaccines themselves are being paid for by the federal government and not carriers. Topics addressed in this month’s updates include:

  • Operational considerations;
  • Out-of-network coverage and billing;
  • Coding;
  • Therapeutics coverage;
  • Reimbursement for vaccinations in nursing homes and of health care personnel;
  • Vaccine tracking;
  • Reimbursement considerations; and
  • Enrollee outreach.

CMS also updated the toolkit’s frequently asked questions.

Additionally, CMS updated its ongoing Medicare-specific guidance, the COVID-19 Frequently Asked Questions (FAQ) on Medicare Fee-for-Service Billing, this month. Updates relate to laboratory billing for COVID-19 testing, hospital inpatient payments and payments to Indian Health Service hospitals, and Medicare payments for COVID-19 treatments. The FAQ also outlines a number of billing changes that are effective January 1st, 2021.


Throughout December and January, CMS continued to grant state waivers specific to the public health emergency. At the end of December, the agency granted a Section 1115 Medicaid Waiver to Massachusetts. This approval permits the state to:

  • Target mobile testing services on a geographic basis;
  • Triage access to long-term services and supports (LTSS) based on highest need; and
  • Restrict beneficiary choice to a limited network of telehealth providers and ambulance providers offering of mobile testing.

In its approval, CMS also provided expenditure flexibility relative to long-term services and supports (LTSS) and allowed retainer payments for adult day health and habilitation services. It noted that additional flexibilities have been provided via State Plan Amendments, Section 1135 Waivers, Appendix K for 1915(c) Waivers, and the Commonwealth’s existing MassHealth 1115 Waiver.

Massachusetts applied for the waiver last April; it is effective retroactive to March 1st, 2021 until 60 days after the end of the public health emergency.

CMS also granted seven additional Section 1135 Waivers[1] and 44 new Appendix Ks for 1915(c) Waivers in December and January. Most of the newly-approved Section 1135 Waivers relate to the continuation or reinstatement of benefits relative to a fair hearing or Medicaid managed care appeal. To support states as they continue to identify needs for Section 1135 Waiver flexibility, CMS launched a web tool for Section 1135 Waiver requests this month. States can use the tool to document and submit waiver requests and other inquiries related to the public health emergency.

In addition to state-specific waivers, CMS updated its blanket waivers for healthcare providers in December and announced flexibility relative to the 24-hour limit on patients receiving care in Ambulatory Surgical Centers.

Legislation: COVID-19 Relief Funding and Other Health Care Provisions

Last, but certainly not of least significance, Congress and former President Trump finally reached agreement on further COVID-19 relief at the end of 2020, and included it in the 2021 Consolidated Appropriations Act that prevented government shutdown. The bill includes funding for COVID-19 vaccine distribution and testing, public health data systems, and community health centers. Equally as meaningful are provisions not directly related to the pandemic, including protections from surprise medical bills, continuity of care provisions, enhanced mental health parity requirements, and healthcare cost transparency provisions.

No Surprises Act

The No Surprises Act—which Health Policy News first reported on in 2019—was signed into law as part of the appropriations package. Its passage will result in the implementation of long-discussed protections against surprise medical bills. The Act limits the amount patients can be charged by out-of-network emergency service providers (including ambulances and air ambulances), as well as for out-of-network services provided at in-network facilities, unless the patient consents to be treated by an out-of-network provider. It establishes an arbitration process (between the provider and insurer) for disputes regarding payment amounts.

These new standards apply to individual and group health plans, including self-funded plans, grandfathered plans, and coverage offered through the Federal Employees Health Benefits Program. Short-term Limited Duration Insurance is exempt.

Continuity of Care Provisions

Also included in the Appropriations Act are continuity of care provisions, aimed at protecting certain patients whose insurance plans’ provider network changes during a plan year. These protections are available for 90 days following a provider network change, and only apply to patients who are:

  • undergoing a course of treatment for a serious and complex condition;
  • receiving institutional or inpatient care; or
  • pregnant, terminally ill or scheduled for non-elective surgery.

Insurers must notify patients of the provider’s status change and their right to request continued benefits.

Mental Health Parity Requirements

Under the new law, insurers must also document comparative analyses of their coverages’ mental health / substance use disorder parity relative to non-quantitative treatment limits. Federal officials are required to request a selection of analyses each year, focusing on entities that have potentially violated federal parity requirements, and may require corrective action plans.


[1] Alaska, Kentucky, Massachusetts, Minnesota, Nevada, Oregon (12/2/2020 and 12/9/2020), Texas

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