House COVID-19 package to include funding for vaccines, testing and boosting Medicaid payments

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A part of the $1.9 trillion reconciliation package includes money to boost Medicaid payments to states and eligibility for coverage. (Getty Images)

The House is proposing that a portion of a $1.9 trillion COVID-19 relief package includes more than $50 billion for vaccines and testing to combat the virus and to temporarily expand Medicaid coverage and payments to states.

The House Energy and Commerce Committee released legislative text late Tuesday for its part of the massive relief package moving through the House.

“As new variants of the virus emerge, it is vital that Congress act quickly to provide relief to the American people and the resources and support needed to bring an end to the COVID-19 pandemic,” said committee chairman Rep. Frank Pallone, D-New Jersey, in a statement.

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The legislation would give the Department of Health and Human Services $46 billion for testing, including creating a national strategy for testing and contact tracing of COVID-19. Part of that funding includes $1.75 billion to the Centers for Disease Control and Prevention (CDC) to improve activities such as genomic sequencing to identify variants of the virus spreading now in the U.S.

Energy and Commerce also want to give $7.5 billion to the CDC to promote and administer COVID-19 vaccines. The funding would be used to distribute and purchase new doses of the vaccine and includes $1 billion to boost vaccine confidence.

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The bill also includes several provisions aimed at expanding eligibility and federal payments for Medicaid.

In a bid to further entice states that still haven’t expanded Medicaid under the Affordable Care Act (ACA), the bill would add a five percentage point increase for two years to the state’s base federal matching rate if they decide to expand.

So far 12 states have refused to expand Medicaid under the ACA.

The bill also would expand Medicaid in several areas. For instance, the bill would for five years give Medicaid eligibility to incarcerated individuals 30 days before their release from prison.

It also would extend for five years Medicaid eligibility for women 12 months postpartum.

The committee also would require Medicaid coverage of any COVID-19 vaccines and treatments without any cost-sharing. The legislation would also fully cover vaccines for one year after the end of the public health emergency for COVID-19.

The legislation would also lift a cap on Medicaid drug rebates starting in 2023.

The Medicaid Payment Advisory Commission, a panel that recommends Medicaid policy to Congress, had called for removing the rebate cap, which kicks in at 100% of a drug’s average manufacturing price.

The rebate cap can kick in when a price increases massively over time. Removing it would lead to higher rebates for Medicaid drugs and save Medicaid $15 to $20 billion over 10 years, a report from MACPAC said.

“Manufacturers may threaten to leave the Medicaid program or reduce research on drugs that disproportionately benefit Medicaid enrollees,” MACPAC said.

Energy and Commerce will hold a markup session on Thursday to decide on advancing the legislation to the full House floor.

The COVID-19 package is moving through Congress via a process called reconciliation, a parliamentary procedure that ensures a bill can make it through the Senate via a simple majority and avoid a legislative filibuster. A reconciliation bill must only focus on budgetary and spending items.

The House Ways and Means Committee is marking up its section of the package today. Their section includes changing who is eligible for the ACA’s insurance exchange tax credits.