Policy Playbook: HEROES and HEALS Act Coronavirus Stimulus Bill Comparison
- Aug 25th, 2020
- Nishad A. Rahman
Authors: Nishad A. Rahman, MD (@Nishad_A_Rahman) and Summer Chavez, DO, MPH, MPM (Health Policy Fellow, Georgetown University/Medstar) // Reviewed by: Alex Koyfman, MD (@EMHighAK); and Brit Long, MD (@long_brit)
What is the issue?
The COVID-19 pandemic has caused upheaval on a global scale, including significant damage to the economy. In the second quarter of 2020, the United States’ gross domestic product fell by an estimated annual rate of 32.9%.1 This is more than three times the previous record of 10% in 1958 and almost four times the worst quarter of the Great Recession, making this the most severe economic contracture in the history of the United States.2 This recession is in spite of significant amounts of previously allocated stimulus spending, totaling $3.2 trillion dollars. Different plans have recently been proposed by the House of Representatives and Senate, spurred by the expiration of weekly unemployment benefit payments of $600 at the end of July.3
What does each bill propose?4
On May 15th, the House of Representatives narrowly passed a $3.4 trillion package, entitled the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act by a 208 to 199 margin.5 This bill extends $600 weekly unemployment insurance through January 2021 amongst other benefits including a stimulus check, hazard pay for essential workers and additional aid for the healthcare industry.5 The Health, Economic Assistance, Liability Protection and Schools (HEALS) Act, a package of multiple proposals, was introduced by Senate Republicans on July 27th.6 While this bill has many similarities to the one passed by the House, key differences exist, including liability protections, additional funding for small businesses and the creation of committees to modify certain government programs such as Social Security and Medicare. Embedded within the HEALS Act are the “Safe to Work Act”, “American Workers, Families, and Employers Assistance Act”, “Continuing Small Business Recovery and Paycheck Protection Program Act”, “Safely Back to School and Back to Work Act”, “Trust Act”, “Restoring Critical Supply Chains and Intellectual Property Act” and “Supporting America’s Restaurant Workers Act”.7
The HEROES Act includes $190 billion in hazard pay for essential workers, $81 billion in Medicaid funding, and $98 billion towards insurance payments for laid-off workers.4 Furthermore, this bill contains $100 billion to providers for lost revenue and expenses, $90 billion for COVID-19 treatment costs, and $75 billion for COVID-19 testing and contact tracing.4 The HEALS Act does not include any hazard pay but allocates $32 billion towards community health, $25 billion in provider funding, $26 billion in vaccine and therapeutics, and $16 billion towards COVID-19 testing.4 While there are overlapping areas between the two bills, there are some key differences.
- Hazard Pay: In the HEROES Act, hazard pay is provided as follows: essential workers are paid at a rate of $13 per hour for work, up to a maximum of $10,000 subject to employer payroll taxes.8,9,10 This means that the typical resident may be eligible for the entire $10,000 benefit. However, essential workers making over $200,000 per year are eligible for a maximum payment of $5,000.8,9,10 There are no provisions for hazard pay in the HEALS Act.7,8,11
- Cost-Sharing for COVID Treatment: As proposed by the HEROES Act, insurers are mandated to cover services provided due to COVID-19, with waiving of any cost-sharing requirement during the emergency.8,9,10 This includes both Medicare and Tricare, as wells as private insurers.8,9,10 There are no cost-sharing provisions in the HEALS Act.7,8,11
- Student Loans: In the HEROES Act, terms of student loans, payments and interest on federal student loans would be suspended through September 30, 2021, with a 30-day transition period wherein missed payments would not result in collection fees or be reported to consumer reporting agencies.8,9,10 Furthermore, debt relief of up to $10,000 would be provided for student loan borrowers who would have a monthly payment of zero dollars under an income-based repayment plan.8,9,10 This is applicable to both federal and private loans.8,9,10 Moreover, all private student loan payments, interest, collection, and credit information would be stopped until September 30, 2021.8,9,10 The HEALS Act does not allocate any funds towards those that currently have student loans. However, new student loaners who enter repayment on or after October 1, 2020 will only be able to choose between two repayment plans: fixed payments over a maximum of 10 years or an income-based repayment plan that will be 10% of discretionary income.7,8,11 The loan balance will be forgiven on an income-based repayment plan after 20 years for undergraduate borrowers and 25 years for graduate borrowers.7,8,11
- Liability Protections: The HEALS Act creates exclusive coronavirus liability protection for medical practitioners except in cases of gross negligence or willful misconduct and will not preempt other laws providing greater liability protection.7,8,11 The HEROES Act has no specific liability protections.8,9,10
- Rescue Committees: Language within the HEALS Act requires the US Treasury to create a Congressional report concerning specific government trust funds, including Social Security and Medicare.7,12 Leaders in Congress appoint members to bicameral (composed of the Senate and House of Representatives) “Rescue Committees”, which aim to obtain bipartisan support by requiring two members of each party to support legislation, in addition to a committee majority.7,12 The bill is then fast-tracked through Congress, with only a simple majority (51 of 100 votes) required for the motion to continue. The resolution would be considered to be privileged (non-debatable).7,12 For final passage through the Senate, 60 votes are necessary.7,12 There are no comparable provisions present within the HEROES Act.8,9,10
For more in-depth information about each of these bills, refer to the following resources from the American Medical Association:
On August 8th, with Congress engulfed in ongoing negotiations, President Trump signed an executive order and three memorandum into law.13 These provide the following:
- $400 in added unemployment benefits per week, with $300 in federal benefits and the remaining $100 required to be paid by the states.13 Only individuals who are receiving at least $100 already in state unemployment benefits are eligible.13 There is no additional funding for states to provide this benefit.13
- Deferral in payroll taxes from September to December—only the employee portion of the Social Security tax.14 Medicare tax is not included.14 This would apply for all employees making up to $104,000.14 There is currently no provision to forgive the tax liability.14
- The Secretary of Health and Human Services and the CDC Director are to consider if any measures halting eviction for tenants are “reasonably necessary to prevent further spread of COVID-19”.15 This continued moratorium would affect only federally backed mortgages, which comprise about 12.3 million (28 percent) of 43.8 million US rental units.16 No additional funds are provided, but the Secretary of Treasury and Secretary of Housing and Urban Development are tasked with identifying federal funds that may be used.15
- Student loan repayment deferral and continued waiver of student loan interest through December 31st, 2020.17
It is uncertain when the benefits will actually reach the public, considering likely challenges associated with legality, funding and implementation.18 It is also unknown whether states will be able to provide the $100 per week unemployment contribution considering the ongoing COVID-19 economic crisis.19 The situation regarding the next iteration of coronavirus legislation is fluid, so it would be wise to pay close attention to any developments.
Why does this matter?
As Americans, we all have a stake in our economy. Consequently, any policy decision of this magnitude should be of tremendous concern for every citizen. However, there are specific issues which particularly affect medical practitioners and emergency physicians. For example, the presence or absence of hazard pay is of tremendous import to emergency physicians, who are at the frontline of the COVID-19 pandemic. Additionally, funding for therapeutics, COVID-19 testing, insurance payments for laid-off workers, provider reimbursement, and student loan repayment are significant areas of interest. Whichever plan is adopted in the end, it is essential that the economy is put on the most effective path towards recovery, with as little long-lasting harm as possible.
What can I do about it?
- Stay informed about the latest developments.
- Reach out to your local government officials.
- Advocate for decisions which support patients and healthcare providers.
- Advocate for policy that improves the healthcare system.
- Gross Domestic Product, 2nd Quarter 2020 (Advance Estimate) and Annual Update | U.S. Bureau of Economic Analysis (BEA). https://www.bea.gov/news/2020/gross-domestic-product-2nd-quarter-2020-advance-estimate-and-annual-update. Accessed 19 Aug. 2020.
- “3 Months Of Hell: U.S. Economy Drops 32.9% In Worst GDP Report Ever.” NPR.Org, https://www.npr.org/sections/coronavirus-live-updates/2020/07/30/896714437/3-months-of-hell-u-s-economys-worst-quarter-ever. Accessed 19 Aug. 2020.
- Casselman, B. “End of $600 Unemployment Bonus Could Push Millions Past the Brink.” The New York Times, 21 July 2020. NYTimes.com, https://www.nytimes.com/2020/07/21/business/economy/coronavirus-unemployment-benefits.html.
- Parlapiano, A. “The Gulf Between Republicans and Democrats on Coronavirus Aid, in 9 Charts.” The New York Times, 30 July 2020. NYTimes.com, https://www.nytimes.com/interactive/2020/07/30/upshot/coronavirus-stimulus-bill.html.
- Cochrane, E. “House Passes $3 Trillion Aid Bill Over Republican Opposition.” The New York Times, 15 May 2020. NYTimes.com, https://www.nytimes.com/2020/05/15/us/politics/house-simulus-vote.html.
- Congressional Record Senate Articles. https://www.congress.gov/congressional-record/2020/7/27/senate-section/article/S4491-7. Accessed 19 Aug. 2020.
- Update on the Coronavirus Response: HEALS Act. https://www.rpc.senate.gov/policy-papers/update-on-the-coronavirus-response-heals-act. Accessed 19 Aug. 2020.
- “Comparing the Heroes and HEALS Acts.” Committee for a Responsible Federal Budget, 7 Aug. 2020, http://www.crfb.org/blogs/comparing-heroes-and-heals-acts.
- Lowey, Nita M. Text – H.R.6800 – 116th Congress (2019-2020): The Heroes Act. 23 July 2020, https://www.congress.gov/bill/116th-congress/house-bill/6800/text.
- “HEROES Act: What Physicians and Medical Students Need to Know.” American Medical Association, https://www.ama-assn.org/delivering-care/public-health/heroes-act-what-physicians-and-medical-students-need-know. Accessed 19 Aug. 2020.
- “HEALS Act: What Physicians and Medical Students Need to Know.” American Medical Association, https://www.ama-assn.org/delivering-care/public-health/heals-act-what-physicians-and-medical-students-need-know. Accessed 19 Aug. 2020.
- Romney, Bipartisan Coalition Introduce TRUST Act for Inclusion in Next Relief Package | Senator Mitt Romney. https://www.romney.senate.gov/romney-bipartisan-coalition-introduce-trust-act-inclusion-next-relief-package. Accessed 22 Aug. 2020.
- “Memorandum on Authorizing the Other Needs Assistance Program for Major Disaster Declarations Related to Coronavirus Disease 2019.” The White House, https://www.whitehouse.gov/presidential-actions/memorandum-authorizing-needs-assistance-program-major-disaster-declarations-related-coronavirus-disease-2019/. Accessed 19 Aug. 2020.
- “Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster.” The White House, https://www.whitehouse.gov/presidential-actions/memorandum-deferring-payroll-tax-obligations-light-ongoing-covid-19-disaster/. Accessed 19 Aug. 2020.
- “Executive Order on Fighting the Spread of COVID-19 by Providing Assistance to Renters and Homeowners.” The White House, https://www.whitehouse.gov/presidential-actions/executive-order-fighting-spread-covid-19-providing-assistance-renters-homeowners/. Accessed 19 Aug. 2020.
- Goodman, Laurie, et al. “The CARES Act Eviction Moratorium Covers All Federally Financed Rentals—That’s One in Four US Rental Units.” Urban Institute, 2 Apr. 2020, https://www.urban.org/urban-wire/cares-act-eviction-moratorium-covers-all-federally-financed-rentals-thats-one-four-us-rental-units.
- “Memorandum on Continued Student Loan Payment Relief During the COVID-19 Pandemic.” The White House, https://www.whitehouse.gov/presidential-actions/memorandum-continued-student-loan-payment-relief-covid-19-pandemic/. Accessed 21 Aug. 2020.
- FEMA Lost Wages Supplemental Payment Assistance | FEMA.Gov. https://www.fema.gov/fact-sheet/fema-lost-wages-supplemental-payment-assistance. Accessed 19 Aug. 2020.
- Trump Unemployment Insurance Executive Order Will Cost States Billions. https://www.cbsnews.com/news/trump-unemployment-insurance-executive-order-400-states-billions/. Accessed 19 Aug. 2020.