House Proposes HEROES Act as Fifth Round of Stimulus Funding

The (HEROES) Act provides additional funding for healthcare providers and small business support, as well as for law enforcement, housing, food assistance and economic relief (in the form of extended unemployment benefits, student loan debt relief, and various tax credits for employee retention, payroll tax and paid leave). It also proposes another direct payment of $1,200 for eligible individuals (using the same income-based criteria as the CARES Act), but increases the amount per dependent from $500 to $1,200.

It contains protections for healthcare coverage through Medicaid, Medicare, private insurance, and federal plans such as TRICARE, VA and the Federal Employee Health Benefit Program. It also establishes guidelines to tackle some of the supply chain issues we’ve seen thus far in the response, including the appointment of a Medical Supplies Response Coordinator to oversee medical supply chain logistics.

There is quite a lot to digest in the proposed 1,815-page legislation, but I’ll highlight some of the provisions having the most impact on federal contractors:

Select Federal Funding Provisions:

• Census - $410M for the Census Bureau related to delays in the 2020 Dicennial Census process. It also
• Justice - $200M for medical testing and services, personal protective equipment, hygiene supplies and services, and sanitation services for the Bureau of Prisons
• Federal Communications Commission - $5.5B for broadband connectivity - Wi-Fi hotspots, emergency home connectivity and connected devices for students and library patrons
• Small Business Administration - $10B in small business grants (and increases to the loan caps under SBA’s business loan program account)
• General Services Administration - $1B for GSA’s Technology Modernization Fund
• $1B for Interior for building hospitals and critical infrastructure in Insular Areas (U.S. territories).
• Health and Human Services
  • $2.1B for the Indian Health Service, including funds to provide healthcare ($500M), IT and broadband and IT for telehealth and electronic health records ($140M), and sanitation, hydration and hygiene needs ($10M)
  • $7.6B for the Health Resources and Services Admin to expand healthcare services for underserved populations
  • $2.1B for the CDC, of which $130M is for modernization of IT infrastructure to support public health data surveillance and analytics.
  • $4.7B for NIH to support costs of biomedical research labs
  • $4.5B for the Biomedical Advanced Research and development Authority (BARDA) for therapeutics and vaccine development, manufacturing facilities and antibacterial R&D
  • $175B for the Public Health and Social Services Fund to reimburse healthcare providers and support testing and contact tracing

Other Provisions:

• Vaccines - Requires the HHS Secretary to award contracts, grants, cooperative agreements, etc., and report on vaccine manufacturing capacity and plans.
• Public Data Infrastructure  
  • Requires HHS to expand and improve CDC’s public health data systems infrastructure – data infrastructure capabilities and gaps; data collection, maintenance and analysis capabilities, system interoperability; information sharing and electronic case reporting.
  • Requires HHS to develop an online COVID-19 reporting portal for health organization to track and transmit data on inventory and capacity.
  • Directs funding for AHRQ, CDC, DMS, FDA and the Office of the National Coordinator for Health Information Technology (ONCHIT) to modernization data collection methods and infrastructure.
• Federal Contractors
  • Mandates that agency leaders allow contractor employees to telework if the work can be done remotely, and provide telework reports to Congress.
  • Requires OMB to issue additional guidance to agencies on implementation of Section 3610 of the CARES Act (allows agencies to reimburse contractors for costs associated with keeping their employees in a “ready state”)
  • Ensures that the performance ratings for contractors’ whose work has been disrupted due to the virus will not be adversely affected.
  • Requires contracting officers to ensure that prime contractors are paid within 15 days of invoice submission.
  • Expands the use of the Defense Production Act to increase production of medical equipment and supplies
  • Requires employers of workers at occupational risk of COVID-19 exposure to develop disease exposure control plans under guidance from OSHA.

The House plans to vote on this bill (H.R. 800) on Friday, May 15. It doesn’t appear, however, that Senate Republicans are on board with another round of stimulus funding, at least before they can assess the impact of partial reopening of the economy. The Senate is scheduled to break from May 25-29, so it’s unlikely that there will be movement on this bill before June 1.