What GAO Found
- HHS, in coordination with FEMA, should immediately document roles and responsibilities for supply chain management functions transitioning to HHS, including continued support from other federal partners, to ensure sufficient resources exist to sustain and make the necessary progress in stabilizing the supply chain.
- HHS, in coordination with FEMA, should further develop and communicate to stakeholders plans outlining specific actions the federal government will take to help mitigate supply chain shortages for the remainder of the pandemic.
- HHS and FEMA—working with relevant stakeholders—should devise interim solutions, such as systems and guidance and dissemination of best practices, to help states enhance their ability to track the status of supply requests and plan for supply needs for the remainder of the COVID-19 pandemic response.
Why GAO Did This Study
What GAO Recommends
Recommendations for Executive Action
|1||Department of Health and Human Services|
The Secretary of Health and Human Services in coordination with the Administrator of the Federal Emergency Management Agency—who head agencies leading the COVID-19 response through the Unified Coordination Group—should immediately document roles and responsibilities for supply chain management functions transitioning to the Department of Health and Human Services, including continued support from other federal partners, to ensure sufficient resources exist to sustain and make the necessary progress in stabilizing the supply chain, and address emergent supply issues for the duration of the COVID-19 pandemic. (Recommendation 1)
|2||Department of Health and Human Services|
The Secretary of Health and Human Services in coordination with the Administrator of the Federal Emergency Management Agency—who head agencies leading the COVID-19 response through the Unified Coordination Group—should further develop and communicate to stakeholders plans outlining specific actions the federal government will take to help mitigate remaining medical supply gaps necessary to respond to the remainder of the pandemic, including through the use of Defense Production Act authorities. (Recommendation 2)
|3||Department of Health and Human Services|
The Secretary of Health and Human Services—who heads one of the agencies leading the COVID-19 response through the Unified Coordination Group—consistent with their roles and responsibilities, should work with relevant federal, state, territorial, and tribal stakeholders to devise interim solutions, such as systems and guidance and dissemination of best practices, to help states enhance their ability to track the status of supply requests and plan for supply needs for the remainder of the COVID-19 pandemic response. (Recommendation 3)
|4||Department of Homeland Security : Directorate of Emergency Preparedness and Response : Federal Emergency Management Agency|
The Administrator of the Federal Emergency Management Agency—who heads one of the agencies leading the COVID-19 response through the Unified Coordination Group—consistent with their roles and responsibilities, should work with relevant federal, state, territorial, and tribal stakeholders to devise interim solutions, such as systems and guidance and dissemination of best practices, to help states enhance their ability to track the status of supply requests and plan for supply needs for the remainder of the COVID-19 pandemic response. (Recommendation 4)
|5||Department of Health and Human Services|
The Secretary of Health and Human Services, with support from the Secretary of Defense, should establish a time frame for documenting and sharing a national plan for distributing and administering COVID-19 vaccine, and in developing such a plan ensure that it is consistent with best practices for project planning and scheduling and outlines an approach for how efforts will be coordinated across federal agencies and nonfederal entities. (Recommendation 5)
|6||Department of Health and Human Services : Public Health Service : Centers for Disease Control and Prevention|
As the Centers for Disease Control and Prevention (CDC) implements its COVID-19 Response Health Equity Strategy, the Director of the Centers for Disease Control and Prevention should determine whether having the authority to require states and jurisdictions to report race and ethnicity information for COVID-19 cases, hospitalizations, and deaths is necessary for ensuring more complete data, and if so, seek such authority from Congress. (Recommendation 6)
|7||Department of Health and Human Services : Public Health Service : Centers for Disease Control and Prevention|
As CDC implements its COVID-19 Response Health Equity Strategy, the Director of the Centers for Disease Control and Prevention should involve key stakeholders to help ensure the complete and consistent collection of demographic data. (Recommendation 7)
|8||Department of Health and Human Services : Public Health Service : Centers for Disease Control and Prevention|
As CDC implements its COVID-19 Response Health Equity Strategy, the Director of the Centers for Disease Control and Prevention should take steps to help ensure CDC’s ability to comprehensively assess the long-term health outcomes of persons with COVID-19, including by race and ethnicity. (Recommendation 8)
|9||Department of the Treasury|
The Secretary of the Treasury, in coordination with the Commissioner of Internal Revenue, should update and refine the estimate of eligible recipients who have yet to file for an economic impact payment to help target outreach and communications efforts. (Recommendation 9)
|10||Department of the Treasury|
The Secretary of the Treasury, in coordination with the Commissioner of Internal Revenue, should make estimates of eligible recipients who have yet to file for an economic impact payment, and other relevant information, available to outreach partners to raise awareness about how and when to file for economic impact payments. (Recommendation 10)
|11||Executive Office of the President : Office of Management and Budget|
The Director of the Office of Management and Budget, in consultation with the Department of the Treasury, should issue the addendum to the 2020 Compliance Supplement as soon as possible to provide the necessary audit guidance. (Recommendation 11)
The Director of the Centers for Disease Control and Prevention should ensure that, as it makes updates to its federal guidance related to reassessing schools’ operating status, the guidance is cogent, clear, and internally consistent. (Recommendation 12)
|13||Department of Homeland Security|
The Secretary of Homeland Security, in coordination with the Secretary of Defense, should (1) revise the criteria in the 2019 National Interest Action code memorandum of agreement to clearly identify steps they will take to obtain input from key federal agencies prior to extending or closing a National Interest Action code, (2) establish timelines for evaluating the need to extend a National Interest Action code, and (3) define what constitutes a consistent decrease in contract actions and routine contract activity to ensure the criteria for extending or closing the National Interest Action code reflect government-wide needs for tracking contract actions in longer term emergencies, such as a pandemic. (Recommendation 13)
|14||Department of Defense|
The Secretary of Defense, in coordination with the Secretary of Homeland Security, should (1) revise the criteria in the 2019 National Interest Action code memorandum of agreement to clearly identify steps they will take to obtain input from key federal agencies prior to extending or closing a National Interest Action code, (2) establish timelines for evaluating the need to extend a National Interest Action code, and (3) define what constitutes a consistent decrease in contract actions and routine contract activity to ensure the criteria for extending or closing the National Interest Action code reflect government-wide needs for tracking contract actions in longer term emergencies, such as a pandemic. (Recommendation 14)
|15||Department of Health and Human Services|
The Secretary of Health and Human Services, in consultation with the Centers for Medicare & Medicaid Services and CDC, should develop a strategy to capture more complete data on confirmed COVID-19 cases and deaths in nursing homes retroactively back to January 1, 2020, and to clarify the extent to which nursing homes have reported data before May 8, 2020. To the extent feasible, this strategy to capture more complete data should incorporate information nursing homes previously reported to CDC or to state or local public health offices. (Recommendation 15)
|16||Department of Health and Human Services|
Based on the imminent cybersecurity threats, the Secretary of Health and Human Services should expedite implementation of our prior recommendations regarding cybersecurity weaknesses at its component agencies. (Recommendation 16)
- the key actions the federal government has taken, to date, to respond to and recover from COVID-19 and
- evolving lessons learned relevant to the nation's response to the COVID-19 pandemic.
IN THIS SECTION
Key Federal Actions to Respond to and Recover from COVID-19
- Helping preserve existing supplies. The Advisory Group worked with CDC and the Food and Drug Administration (FDA) to provide guidance to health care providers and others on PPE decontamination and equipment efficiencies, such as techniques for using one ventilator to provide oxygen to two individuals simultaneously.
- Accelerating the delivery of supplies. On June 30, 2020, FEMA concluded its operation of Project Air Bridge, which expedited the delivery of materials from overseas, such as masks and gloves. Additionally, based on the Advisory Group’s efforts to understand national demand, HHS and FEMA used DPA Title I authorities to place priority ratings on at least 18 contracts from March through May 2020 to acquire ventilators, N95 respirators, and other face coverings, with most types of items scheduled to be delivered by August 31, 2020. DPA Title I authorities require the contractor (and the contractor’s supply chain) to provide preferential treatment to fulfill the delivery requirements of the rated contract or order.
- Expanding the production of supplies. The Advisory Group and others have continued efforts to increase the domestic production of supplies. For example, as of August 15, 2020, DOD had used DPA Title III authorities and other funds to award about $627 million on 17 projects to expand domestic production of medical (including testing) supplies, such as N95 respirators, testing kits, and swabs. These efforts to increase supply production will also help HHS accumulate stockpiles to prepare for future shortages when current demand for supplies abates. Specifically, HHS intends to build a 90-day supply of PPE in the SNS, including N95 respirators, gloves, and testing supplies, in case of an increase in COVID-19 cases.
- Gathering data to help allocate scarce supplies. To aid in the allocation of PPE, the Advisory Group gathered supply and demand data from a variety of sources, including interagency partners and industry. For example, by obtaining and aggregating proprietary information on supply orders to, and fulfillments from, the six largest domestic medical supply distributors, officials said they received real-time information on the movement of critical medical supplies and a sense of gaps and shortfalls in supplies. The Advisory Group transitioned this data collection effort to HHS, and ASPR officials told us the transition was completed September 1, 2020.
- Nursing home distributions. FEMA also coordinated the delivery directly to Medicare- and Medicaid-certified nursing homes of a 14-day supply of gloves, surgical masks, gowns, and eye protection from May through August 2020. Additionally, in July 2020, HHS announced that it would provide point-of-care testing devices and kits to all nursing homes across the country, beginning with distribution to 2,000 prioritized nursing homes. According to HHS’s Daily Communications Report, as of September 3, 2020, the federal government had shipped 9,894 nursing homes almost 3 million tests and 10,637 testing instruments.
- Monthly state testing allocations. According to HHS officials, states received monthly allocations of certain testing supplies based, in part on each state’s testing plan, utilization of supplies from the prior month, epidemiological indicators, and logistical considerations. HHS officials also said that states are able to request additional testing supplies when needed, which HHS makes every effort to accommodate.Additionally, CDC’s International Reagent Resource continues to distribute reagents—substances needed to process tests—and other resources to public health laboratories; CDC officials told us they are able to fulfill 90 percent or more of the requests they receive.
- Federal delivery deferrals. According to Advisory Group officials, the federal government is renegotiating contracts with some of its manufacturers to defer delivery of N95 respirators to federal warehouses to help ensure supplies are available on the commercial market. Additionally, the government will work with the manufacturers to allocate those supplies to nursing homes, hospitals, and other groups that had not been previously prioritized, such as dentists’ offices.
- FDA announced a list of devices determined to be in short supply. On August 14, 2020, FDA published a list of devices—PPE, testing supplies and equipment, and ventilation-related products—that it had determined to be in shortage during the duration of the COVID-19 pandemic (see fig. 4). The Advisory Group and FEMA officials also acknowledged the constrained availability of supplies, in part due to limited U.S. manufacturing and high global demand. For example, FEMA stated that the agency had open requests from state, local, tribal, and territorial governments for more than 139 million nitrile gloves (which Advisory Group officials said were not domestically manufactured), 11 million surgical gowns, and 6 million N95 respirators, as of August 4, 2020. FEMA also noted that the supply of N95 respirators for medical use is not expected to catch up to demand until January 2021. Officials within HHS’s Office of the Assistant Secretary for Health (OASH), who lead federal efforts to support states in their COVID-19 testing plans, acknowledge that there are testing supply shortages. In particular, they noted shortages around some of the more efficient testing platforms requiring specialized and proprietary supplies.
- Officials from seven of eight states interviewed in July and August 2020 and stakeholder groups we interviewed also identified ongoing constraints around certain types of PPE. For example, one state official told us that the state was unable to fulfill local entities’ requests for N95 respirators and nitrile gloves, but that the state had a sufficient supply of other items, such as face shields. Additionally, two states’ officials we interviewed expressed concern about the uncertain path of the virus and the impact of a fall surge on supply availability. As such, while the commercial market is currently the route for most states to obtain supplies, some state officials told us they plan to continue to request supplies from FEMA for items with more limited availability.
- Information reported by nursing homes and medical provider associations also indicated ongoing specific constraints with PPE. According to data that nursing homes self-reported to CDC, about 22 percent of nursing homes reported they did not have a 1-week supply of at least one or more of the following: N95 respirators, surgical masks, gloves, eye protection, or gowns, as of July 26, 2020. The American Nurses Association surveyed both members and nonmembers in late July and early August about their PPE experiences over the prior 2 weeks. Their results found that 88 percent of the over 14,000 responding nurses reported being required or encouraged to reuse single-use N95 respirators. For those who reported reusing N95 respirators, 62 percent expressed concerns about their safety as a result. Additionally, the biggest obstacle to physicians reopening their practices is “ongoing shortages of PPE, especially N95 masks and gowns,” according to a June 30, 2020, American Medical Association letter to the Vice President, who leads the White House Coronavirus Task Force.
- States and associations also report pervasive testing supply shortages. Consistent with FDA’s reporting of key testing supply shortages for the duration of the pandemic, officials from seven of the eight states we interviewed in July and August 2020 identified previous or ongoing shortages of testing supplies, including swabs, reagents, tubes, pipettes, and transport media. The Association of Public Health Laboratories reported in early August that 23 percent of public health laboratories reported they would run out of reagents or other testing supplies within a week. Officials in six of the eight states we interviewed identified difficulty acquiring reagents and test kits from the commercial market, and one state official noted that challenges obtaining testing supplies have grown with the increase in testing demand across the country. Hospitals in Arkansas have had to limit their COVID-19 testing to 10 percent of full capacity due to a shortage of reagents, according to a July 2020 letter from members of the Arkansas congressional delegation to the Vice President. Furthermore, officials from three of eight states and two stakeholder groups that we interviewed in July and August identified plastic supplies such as pipettes as a new type of item in shortage.In HHS’s initial COVID-19 Strategic Testing Plan, submitted to Congress in May 2020, HHS did not identify specific actions it or other federal agencies would take to address certain testing supply shortages. For example, the May COVID-19 Strategic Testing Plan stated that because an efficient reagent marketplace was already in place, the federal government did not intend to purchase and distribute reagents on behalf of states; however, we heard from several states that they were experiencing reagent shortages.The subsequent COVID-19 Strategic Testing Plan, submitted to Congress in August 2020, outlined recent actions that the federal government had taken to enhance the testing supply chain, including using DPA authorities for supplies such as reagents, and that HHS would consider further use of DPA authorities moving forward. However, the August COVID-19 Strategic Testing Plan did not identify actions to address pipettes and other plastic supplies that states and stakeholders have recently reported to be in short supply.
- ASPR officials noted that “shortages” are subjective and depend upon several factors, including the amount and target number of days of supplies the state or hospital has determined to stockpile, or the time that it takes between requesting and receiving supplies—a perspective echoed by Advisory Group officials.
- FEMA and ASPR officials noted that state, local, tribal, and territorial governments have overestimated their needs for supplies. For example, ASPR officials noted that one state with a population of around 11 million people overestimated its need by requesting approximately 15 million N95 respirators. FEMA officials said it was difficult for states and others to assess their true resource needs, in particular, earlier in the pandemic. This exacerbated the view that shortages existed, which in turn may have led to current needs being exaggerated in the volume of open requests for supplies, according to ASPR officials.
- Some federal officials and stakeholders we spoke with noted that testing supply shortages can be fluid in nature. Many components are required to run a laboratory-based test, and many testing instruments require specialized and proprietary supplies to operate. According to some state officials, the market can experience a shortage in supply for one component that is then resolved, only to be followed by the shortage in supply of another component. For example, one state reported that early in the pandemic response, there were reported shortages of swabs, but as those shortages resolved, shortages of other instrument-specific items, such as reagents, emerged.
- assessing critical medical supply chain requirements and gaps,
- identifying and implementing strategies to resolve and mitigate gaps and shortfalls between production and supplies, and
- developing contingency capacity and capability to address future gaps or shortfalls.
- In May 2020, the President signed an Executive Order authorizing the Chief Executive Officer of the International Development Finance Corporation to make loans and take other actions to expand domestic production of strategic resources to respond to the pandemic.
- In August 2020, the President signed an Executive Order intended to increase domestic production of essential medicines, medical countermeasures including PPE, and their critical inputs. It directs the FDA Commissioner, in consultation with the Director of the Office of Management and Budget, ASPR, the Assistant to the President for Economic Policy, and the Director of the Office of Trade and Manufacturing Policy, to create a list of these items within 90 days. It also directs federal agencies to take various steps to increase domestic production of these items.
- Responsibility for procuring and distributing testing swabs and transport media to states transitioned from FEMA to HHS’s OASH in July 2020, according to HHS officials.
- Responsibility for monitoring commercial supply availability to, for example, inform procurement decisions by analyzing data from domestic medical supply distributors transitioned from the Advisory Group to ASPR in September 2020, according to ASPR officials.
- Responsibility for other supply acquisition conducted by DOD on behalf of ASPR—including market research, contract solicitation, proposal evaluation, and contract execution—will begin to transition to ASPR in September. In preparation for this transition, DOD is currently guiding ASPR staff on these activities, according to officials from both agencies.
- Responsibility for fulfilling state, local, tribal, and territorial governments’ requests for supplies and other resources will transition from FEMA to the SNS, according to HHS officials and documentation we received from ASPR.
- Knowing when or which supplies will arrive. Officials from the majority of 10 states we interviewed, as well as officials from one FEMA regional office and an association representing emergency managers, described challenges regarding deliveries. For example, an official from one state described frustrating experiences verifying the delivery of supplies and said that manifests containing tracking information often arrived several days behind the arrival of the actual shipment. The official noted that the people delivering federal supplies did not provide estimated times of arrival and said that on multiple occasions, the delivery went to a place other than the expected delivery site, requiring state officials to respond to phone calls at 2 or 3 a.m. to help manage the resulting confusion. An official from another state similarly described frustrations with uncertainty about when PPE would be delivered, saying that even a number of months into the response, the state's staff cannot say with any confidence when items will arrive; rather, shipments “just show up” without advance notice.
- Tracking deliveries made directly to local points of care. Officials from the majority of the states we interviewed, as well as officials from one FEMA regional office, reported having trouble confirming that the right entities received correct and usable supplies when supplies provided through federal programs arrive directly at local points of care, such as hospitals, laboratories, or nursing homes. For example, officials from one state described trying to track supplies delivered directly to medical facilities, and after raising the issue with FEMA and HHS representatives, received only a list of which counties received the supplies but not the specific facilities where those supplies were delivered. Another state official in a different FEMA region said that the FEMA regional office provided information stating that FEMA had shipped supplies to somewhere in the state, but the information did not specify where the supplies went or to whom they were delivered.
- Budgeting for ongoing supply needs. State officials described challenges determining how to best apply funding from various federal programs and make budgeting decisions for future supply needs:
- Officials from the majority of the 10 states we interviewed expressed concerns and frustrations over uncertainty about whether and to what extent states and other recipients would be responsible for sharing the cost of supplies provided by the federal government. Officials from the majority of FEMA regional offices we interviewed also described states’ confusion about reimbursement, cost share responsibility, and concerns about potential duplication of benefits. FEMA generally reimburses 75 percent of the eligible cost of medical supplies that states purchase under its Public Assistance program and received through mission assignments. Conversely, supplies that states and other recipients receive directly from the SNS are covered at 100 percent and are not subject to cost sharing. To illustrate, officials from at least two states described being uncertain as to which supplies and delivery efforts were provided by FEMA programs and which were provided through another federal channel because shipments did not always contain paperwork indicating the provider, compounding confusion about whether their states would be responsible for sharing the cost for such supplies and activities.
- State officials also reported that different timelines and guidance for FEMA’s Public Assistance Program and the CRF make it difficult for nonfederal entities to optimize resources from these programs. Certain supplies are eligible under both programs. In addition, the Department of the Treasury (Treasury) has provided information describing use of the CRF to meet the nonfederal cost share for FEMA assistance. Therefore, state, territorial, and tribal officials have to make decisions about the best way to apply these funds to meet their medical supply needs. According to one state official, the different timelines and requirements for each program, particularly the requirement that payments from the CRF may only be used to cover costs incurred by the end of calendar year 2020, have made deciding the best way to use these funds challenging.  Completing Public Assistance projects typically takes time, and users can face delays during the review and approval process.
- Officials from the majority of the 10 states we interviewed expressed concerns and frustrations over uncertainty about whether and to what extent states and other recipients would be responsible for sharing the cost of supplies provided by the federal government. Officials from the majority of FEMA regional offices we interviewed also described states’ confusion about reimbursement, cost share responsibility, and concerns about potential duplication of benefits.
GAO Recommendations Related to the Medical Supply Chain
- Continued federal expenditures for testing. The COVID-19 relief laws appropriated a total of $26.5 billion to HHS to support COVID-19 testing. HHS reported total testing-related obligations of about $14.35 billion as of July 31, 2020, and total expenditures of $1.17 billion. See table 1 for HHS-reported obligations and expenditures for testing-related activities. Source: GAO analysis of Department of Health and Human Services (HHS) information. | GAO-20-701
Note: the percentages represent the share of obligations for each key activity that were expended as of July 31, 2020.We requested information from HHS to explain why expenditures represent a small share of total obligations. HHS responded that it was primarily due to the slow rate at which states have used the funds they were awarded; however, HHS’s response did not address why its expenditures of amounts allocated for federal testing activities comprised 9 percent of its obligations. HHS noted that the length of time it will take to spend all federal appropriations allocated for testing is highly dependent on the progression of the COVID-19 pandemic and its impact on specific U.S. geographic locations and populations.The Paycheck Protection Program and Healthcare Enhancement Act required each state, territory, or local jurisdiction receiving funding to submit to HHS a plan for how they will meet their testing targets. Officials from states we interviewed told us they intend to use these funds to support testing in various ways, such as by procuring additional testing supplies when available, creating partnerships with local private sector entities to expand testing capacity, improving mobile testing capacity, expanding the laboratory and epidemiological workforce, and investing in information technology upgrades. HHS officials told us that the funding is available to recipients for 30 months and is expected to be expended over time.
- Enhanced support for testing supplies. As described above, FEMA and HHS have continued to procure swabs, transport media, and point-of-care tests on behalf of states and territories. FEMA and HHS also procured point-of-care tests on behalf of certain federal agencies. HHS will continue to procure these supplies through December 2020.
- Invested in new testing technologies. In late July, the National Institutes of Health's (NIH) Rapid Acceleration of Diagnostics (RADx) initiative awarded contracts totaling nearly $250 million to seven companies to support new testing technologies. NIH stated that these investments have the potential to increase the number, type, and availability of tests by fall 2020. Four of the technologies could increase testing capacity while reducing the time to receive test results. Three of the technologies use platforms that can give rapid results in non-laboratory settings, such as work sites, nursing homes, and schools. In early September, NIH announced an additional round of awards totaling over $129 million to nine companies.
- Invested in capacity expansion for two laboratories. On August 13, 2020, HHS announced a $6.5 million dollar investment in two commercial laboratories. Specifically, the agency is providing these companies with resources, such as testing equipment and supplies, to increase testing capacity by up to an additional 4 million tests per month starting in early October.
- Expanded support for testing sites. HHS established public-private partnerships with a commercial laboratory company and retail pharmacy and grocery store chains to implement and reimburse testing through August 2020. As of mid-August, these sites had tested more than 1.6 million individuals, according to HHS documentation. In addition, HHS set up surge temporary testing sites in multiple communities to increase federal support in areas with recent spikes in new cases and hospitalizations.
- Clarified guidance and implemented enforcement mechanisms to enhance testing data. Shortly before the August 1, 2020 testing data reporting deadline, HHS published implementation specifications with standard definitions for all of the data that laboratories are required to report to CDC through state and territorial health departments. These specifications are aimed to help improve the quality of testing data CDC receives, and in turn allow the agency to more accurately monitor testing. According to CDC, 40 of the 56 states and territorial jurisdictions had completely developed the capability to relay detailed testing data to CDC as of August 24, 2020.To improve consistency and uniformity in the reporting of testing data, on September 2, 2020, CMS published an interim final rule that provides sanctions for laboratories that fail to report COVID-19 testing data consistent with the form and manner specified by HHS. We will monitor the implementation of this guidance in our ongoing work.
- In early July, LabCorp announced on its website that its average time to deliver test results was 4 to 6 days, citing constraints in the availability of supplies and equipment.
- Quest Diagnostics announced in late July that the average turnaround time for reporting test results had increased to 7 days or more for nonpriority populations.
- In the HHS COVID-19 Strategic Testing Plan, submitted to Congress on August 22, 2020, HHS stated that communities seeing increased turnaround times for test results may choose to prioritize testing to only those who “need” a test according to CDC or state and local guidelines; however, HHS did not define who needs a test in this plan. Subsequently, on August 24, CDC revised its testing guidelines to state that asymptomatic individuals with a known exposure to COVID-19 do not necessarily need a test unless they are a vulnerable individual or their health care provider or state or local public health officials recommend a test. Further, the revised guidelines stated that asymptomatic individuals without a known exposure do not need to be tested. Several public health organizations, including the American Medical Association, the National Association of County and City Health Officials, and others, have expressed concern over CDC’s guidelines for asymptomatic people who have been exposed to COVID-19, citing the need for a rationale for the change. For example, the Association of American Medical Colleges expressed concern that the new CDC guidelines will result in less testing of asymptomatic individuals, who may go on to infect others if they carry the virus. GAO will continue to monitor this issue.
- Several states, including Alabama, California, Michigan, Minnesota, and Virginia, have issued guidelines for prioritizing testing of certain populations, such as people requiring hospitalization and health care workers. Guidelines from California, Minnesota, Michigan, and Virginia recommend prioritizing testing for asymptomatic individuals who are close contacts of confirmed COVID-19 cases.
- In May 2020, the University of Minnesota’s Center for Infectious Disease Research and Policy noted that the need for testing will likely far outpace capacity, particularly during surges, and recommended prioritizing testing based on CDC guidelines at that time.
- Public health researchers from the Rockefeller Foundation and Harvard University have called for an increased use of antigen tests in a screening capacity, including among asymptomatic individuals, noting that this approach would be useful when re-opening certain settings, such as schools and large workplaces.
- In July and August 2020, the federal government awarded contracts to manufacturers of three antigen tests to purchase or increase production of these tests. For example, HHS awarded a contract for the delivery of 150 million Abbott BinaxNOW COVID-19 Ag Card Point of Care tests, with the intention of distributing them for testing at schools and for testing other special needs populations. Also, in August 2020, 10 states joined together to conduct group purchasing of 5 million antigen tests.
- HHS and DOD have announced a total of about $12.6 billion in awards to support Operation Warp Speed and to accelerate the development, manufacturing, and distribution of COVID-19 vaccines and therapeutics, as of September 1, 2020. For example, HHS and DOD announced an award of a $138 million contract for the production of more than 100 million prefilled syringes by the end of 2020.
- Manufacturing capacity is being advanced for selected Operation Warp Speed vaccine candidates while they are still in development; typically, large-scale manufacturing of vaccine occurs after it is shown to be safe, pure and potent (i.e., safe and effective). According to HHS, the federal government is taking a financial risk by manufacturing certain selected vaccines before information about the vaccines’ safety and efficacy is known to ensure vaccines are available as soon as possible, once such information is determined.
- A memorandum of understanding between DOD and HHS states that DOD will coordinate the logistics, supply chain, development, and manufacturing of vaccines and therapeutics in support of Operation Warp Speed, among other things.
- As of August 18, 2020, BARDA had awarded about $10.8 billion in support of seven vaccine candidates; these awards included support for the development, manufacturing, and purchase of vaccine doses. Of these seven vaccine candidates, one was in phase 1 of clinical trials, one was in phase 1 and phase 2 of clinical trials, one was in phase 2, three were in phase 3, and the remaining vaccine candidate was not yet in clinical trials, as of September 3, 2020.
- BARDA also awarded about $1 billion for nine therapeutic candidates as of August 18, 2020, and two of these candidates were in phase 1 of clinical trials, one was in phase 2 of clinical trials, and one was in phase 3 trials as of September 1, 2020. In addition, two therapeutics that received BARDA awards had been in phase 3 clinical trials but were no longer supported by BARDA.
- HHS and DOD announced that McKesson Corporation will be a central distributor of COVID-19 vaccines and related supplies in support of Operation Warp Speed. McKesson, which distributed the H1N1 vaccine during the H1N1 pandemic, will work under CDC’s guidance to deliver COVID-19 vaccine to administration sites, according to HHS and DOD announcements released on August 14, 2020.
- HHS has announced it is planning a tiered approach for vaccine distribution. This tiered approach will build on a methodology developed as part of pandemic influenza planning and will be adjusted based on experience during the first wave of the COVID-19 response, among other things, according to an Operation Warp Speed Fact Sheet.
- CDC and NIH have sponsored a committee of experts to develop a framework to assist policymakers in planning for the equitable allocation of COVID-19 vaccine. This committee—convened through the National Academies of Sciences, Engineering, and Medicine and the National Academy of Medicine—held its most recent public meeting in early September 2020. On September 1, 2020, the committee released a discussion draft of a potential allocation framework for public comment. The committee’s final report, expected early this fall, will include a final recommended allocation framework, according to a press release announcing the draft framework. The press release also noted that the committee’s final report will address related issues, such as vaccine hesitancy, demand, and promotion as well as risk communication and strategies for community engagement.
- CDC’s Advisory Committee on Immunization Practices has established a COVID-19 vaccine work group to consider approaches for vaccine distribution. This work group intends to collect, analyze, and prepare information related to COVID-19 vaccines for presentation, discussion, deliberation, and vote by the advisory committee. It is expected to make recommendations on the groups for vaccine prioritization to CDC and HHS leadership. As of August 26, 2020, these recommendations had not yet been made. According to HHS, the advisory committee recognizes that vaccine prioritization will be an iterative process that will be continually refined as more information about the COVID-19 virus, vaccines, and vaccine availability becomes known.
- CDC sent early distribution planning documents to states. CDC sent several documents to state and local jurisdictions in late August 2020 to help them prepare for COVID-19 vaccination. These documents include (1) planning scenarios for state and local jurisdictions to use to develop operational plans for early COVID-19 vaccination when vaccine supply may be constrained, (2) planning assumptions, such as the potential timing for initial availability of a vaccine and storage and handling requirements, and (3) a checklist of early planning action items, such as identifying existing community vaccination providers.
- Representatives said they would need time to enroll additional providers if a COVID-19 vaccine is distributed using the established immunization network that was used during the H1N1 pandemic in 2009.
- It will be important to consider if using uniformed military personnel will improve or undermine confidence in a COVID-19 vaccine, if DOD is expected to play a role in vaccine distribution and administration. This is particularly true in certain minority and underserved communities, where trust in the medical and political systems is strained, according to state, local, and territorial health officials.
- Advanced planning will be needed to develop and disseminate clear public health messaging to help ensure public acceptance and uptake of the vaccine. It will be important to address vaccine hesitancy for people concerned about the safety or effectiveness of the vaccine and to manage expectations about vaccine availability, according to representatives of state, local, and territorial health officials and immunization managers.
GAO Recommendation Related to Vaccine Distribution
The Secretary of Health and Human Services, with support from the Secretary of Defense, should establish a time frame for documenting and sharing a national plan for distributing and administering COVID-19 vaccine, and in developing such a plan ensure that it is consistent with best practices for project planning and scheduling and outlines an approach for how efforts will be coordinated across federal agencies and nonfederal entities. (Recommendation 5)
- Testing. CDC publishes data on COVID-19 testing results on its website, such as the total number of positive tests out of the total number of tests reported. However, it does not include results by race and ethnicity, as these data are not typically collected by laboratories or sent to laboratories by providers, according to some stakeholders we interviewed. We previously reported that since August 1, 2020, all laboratories have been required to report data on COVID-19 test results by race and ethnicity to CDC. On July 31, 2020, HHS published guidance with standard definitions for all information that should be included in testing data, including categories to be used for race and ethnicity data.
- Cases. CDC collects and makes available data on COVID-19 cases, including those that are probable or confirmed, from state and jurisdictional health departments. However, as of July 31, 2020, race and ethnicity data were not available for more than half—52.6 percent—of cases with case report forms received by CDC, or 63.8 percent of total cases reported. CDC officials stated that they have worked with state and local partners to improve the completeness of demographic data, including race and ethnicity, obtained through case reporting. In addition, CDC updated its epidemiological case report form on May 15, 2020, to encourage state and jurisdictional health departments to report more detailed demographic case data, including race and ethnicity, when reporting case information. CDC is also working to expand electronic case reporting through an initiative called Electronic Case Reporting Now, which the agency expects will improve the completeness of race and ethnicity data for cases.
- Hospitalizations. CDC collects and makes available data on COVID-19 hospitalizations, including by race and ethnicity. CDC’s COVID-19-Associated Hospitalization Surveillance Network (COVID-NET) makes data available on hospitalizations by race and ethnicity. However, as of August 1, 2020, these data were limited to approximately 10 percent of the U.S. population because the data represent select counties in 14 participating states. CDC also collects data on hospitalizations from states and jurisdictions that voluntarily report cases; however, according to CDC officials, these data are incomplete.
- Deaths. CDC collects and makes available data on COVID-19 deaths through death certificates collected in the National Center for Health Statistics’ National Vital Statistics System (NVSS). According to CDC, as of August 7, 2020, data on race and ethnicity were available for almost all (over 99 percent) of COVID-19 deaths reported through this system. CDC also collects and makes available data on deaths reported to the case surveillance system from state and jurisdictional health departments. However, CDC reported that as of July 30, 2020, several states did not provide data on race and ethnicity for deaths reported through case reporting. Race and ethnicity data were available for 83.4 percent of deaths with case report forms received by CDC, or 64.6 percent of total deaths reported through case reporting, as of July 31, 2020. According to CDC, it is important to have complete data on deaths by race and ethnicity through case reporting because these data are generally available 2 weeks before data reported through NVSS, allowing state and jurisdictional health departments to identify trends more rapidly.
- Testing. HHS’s testing guidance requires laboratories to report demographic data and recommends that health care or other providers, such as public health testing providers who do not require a doctor’s order, report demographic data to laboratories. However, some stakeholders we interviewed said it would be difficult for laboratories to comply with HHS’s guidance on testing because providers may not collect demographic data from patients at the point of care and are unlikely to do so unless there are requirements or incentives associated with capturing these data. To help address these difficulties, CDC officials stated that the agency has conducted outreach to provider organizations such as the American Medical Association to offer education and assistance on collecting testing data. HHS officials stated that ongoing support for health care providers will be needed to help ensure complete and consistent collection and reporting of testing data.
- Cases. CDC encourages state and jurisdictional health departments to report information on race and ethnicity through its case report form, but agency officials stated that CDC does not have the authority to require the reporting of this information. Further, CDC may not be receiving consistent race and ethnicity data on cases. HHS reported that as of June 25, 2020, 21 state health departments reported race for cases using combined categories, such as including American Indian/Alaska Native and Native Hawaiian/Pacific Islander in an “Other” category. CDC noted that while its case report form includes these two racial groups as separate, state and jurisdictional health departments may report categories for race and ethnicity as “Other” within their state or jurisdictional case reporting systems. HHS stated that it is important to separate data on these two racial groups for testing and all indicators of COVID-19 burden, including cases, hospitalizations, and deaths. HHS explained that the practice of grouping race categories together into an “Other” category can disguise issues that may be unique to specific minority populations, which can further exacerbate existing disparities.
- Hospitalizations. CDC officials stated that the agency does not have plans to require hospitals to report race and ethnicity data for hospitalizations because it does not have the authority to do so. HHS recently released guidance that directs hospitals to provide hospital capacity and utilization data directly to HHS, rather than to CDC; however, this guidance does not include a requirement for hospitals to include race and ethnicity information in their reporting to HHS. Although CDC officials stated that the agency’s collection of hospitalization data, including race and ethnicity information, through COVID-NET has not been affected by this guidance, COVID-NET is limited to 14 participating states, and CDC officials noted that the agency has no immediate plans to expand it to additional states.
- Deaths. CDC officials stated that the agency does not have plans to require states to report race and ethnicity data for deaths reported through the case surveillance system because it does not have the authority to do so.
- CDC officials noted that electronic systems that share data between providers, laboratories, and state and jurisdictional public health departments are often not compatible, resulting in difficulties in transferring complete information on race and ethnicity for testing and indicators of COVID-19 burden. For example, officials stated that information on race and ethnicity from patients’ medical records may not be transferred electronically to laboratories when providers order tests. Further, the officials said that some state and jurisdictional public health departments are not able to automatically incorporate laboratory results, including any associated demographic data such as race and ethnicity, directly into their electronic surveillance systems for case reporting.
- In addition, CDC does not have a comprehensive mechanism to assess the long-term health outcomes of people who have had COVID-19, including by race and ethnicity, to identify potential long-term health effects, such as heart, brain, or lung abnormalities over many months and years. CDC stated that it is funding several studies, including a cohort study that will follow 3,900 patients with COVID-19 6 months after infection, to assess potential complications from COVID-19, including by race and ethnicity. Two additional studies will examine long-term health outcomes of persons with COVID-19 in specific groups, such as American Indian populations. However, these studies are limited to specific groups and time frames, so they are not able to identify long-term health outcomes across other population subgroups that are not included. Some research institutions have recommended the formation of registries that identify and follow individuals who have had COVID-19 over time to better understand the long-term effects on individual and population health. Further, it may be important for CDC to coordinate with other HHS agencies, such as NIH, which conducts and funds long-term public health studies. Assessing the long-term effects of COVID-19 is particularly important for groups who are disproportionately affected by COVID-19, such as racial and ethnic minority groups, to effectively direct care, inform interventions, and tailor public health messaging to these communities.
GAO Recommendations Related to COVID-19 Data by Race and Ethnicity
Based on IRS data, as of July 31, 2020, 5.3 million individuals had used an online IRS tool known as the Non-Filers tool to help them receive their EIP, meaning there could be 8.7 million or more individuals who are eligible but have not received their EIP.
According to Treasury officials, Treasury and IRS want all individuals who are eligible for an EIP to be able to claim one and are taking steps to raise awareness. However, they are also concerned about the difficulty of combining data from various agencies, which can be time-consuming, as well as potential legal restrictions that limit IRS’s ability to share data. The CARES Act provided explicit authority to use data from SSA and RRB for making payments. In addition, IRS worked with VA and was able to obtain data and automatically deliver payments to those benefit recipients.
We will continue to explore whether Treasury and IRS could further coordinate with other federal agencies to obtain and use data to help identify individuals eligible for an EIP before two upcoming deadlines: October 15, 2020, is the deadline to use the Non-Filers tool to file for an EIP in 2020, and December 31, 2020, is the last day IRS will issue an EIP in 2020.
- Non-filers with qualifying children. We reported in June 2020 that individuals who used the Non-Filers tool between April 10 and May 17 did not receive a payment that included additional money for qualifying children. As of July 24, IRS identified 355,103 non-filers who received an individual payment but were still waiting to receive an additional $500 per qualifying child. On August 5, IRS stated on its EIP FAQ webpage that impacted non-filers were to receive the payment via direct deposit on August 5, and paper checks or debit cards were scheduled to be mailed August 7.Additionally, IRS recently announced a policy change that should allow some eligible recipients to receive supplemental payments for qualifying children sooner than expected. As we previously reported, the benefit data IRS had used to automatically send payments to non-filers did not include information on qualifying children, so those recipients were asked to use the Non-Filers tool. However, Social Security and RRB benefit recipients, who comprised nearly 14 million EIP recipients, were given only a few days’ notice to add in information about qualifying children before they would no longer be able to do so. VA and SSI benefit recipients had 2 weeks to add qualifying children and totaled 2.5 million payments by the time of the deadline.Initially, IRS announced that those who missed the deadline would have to wait to file a tax return in 2021 to get a payment for qualifying children. However, the CARES Act requires Treasury and IRS to make the payments as “rapidly as possible.” Waiting 9 to 12 months before an individual or family receives a complete payment during the 2020 tax filing season would not provide the immediate relief intended by the law. Therefore, in the course of our audit work, we asked IRS officials whether they planned to reopen the Non-Filers tool to those individuals who missed the deadline to provide EIPs for qualifying children of non-filers sooner than 2021. IRS officials said they could not reopen the tool to those who missed the deadline to add qualifying children because they would have to manually process the additional information and they lacked the resources to do so, given backlogs caused by the COVID-19 closure of IRS service centers.On August 14, IRS changed this policy with an announcement that it would reopen the registration period. Federal beneficiaries who did not previously receive $500 per qualifying child now have until September 30, 2020, to enter information on their qualifying children and receive the supplemental $500 payments. According to IRS officials, IRS figured out an automated solution that would allow IRS to add information to payments already made. Opening the registration period and extending it through September 30 allows more eligible recipients to seek the financial relief to which they are entitled and owed by law.
- Injured spouses and domestic abuse survivors. IRS is also taking action to issue payments to injured spouses—married taxpayers whose payments were used to cover the past-due child support of a spouse or ex-spouse. As of July 31, 2020, IRS estimated that 49,522 individuals filed an injured spouse claim and may be owed an adjustment. On August 25, IRS announced these catch-up payments will be mailed as checks to any eligible spouse the week of August 31.  There also may be some eligible EIP recipients who are domestic abuse survivors but may not have been able to claim their portion of the EIP if it was provided to an individual’s bank account or address to which eligible recipients do not have access. IRS said it is considering options that may provide relief to domestic abuse survivors, including outreach to advocacy groups for victims of domestic abuse who can advise survivors of legal and other options they can pursue in such situations.
- Widows, widowers, and spouses of deceased and incarcerated individuals. In some cases, Treasury stopped payments to surviving spouses before they were disbursed to account for the death or incarceration of a spouse. IRS did not yet have an estimate of the number of spouses of incarcerated individuals who had their portion of the payment stopped. IRS also estimates nearly 700,000 individuals may have had their payment stopped due to being the spouse of a decedent. IRS plans to pay the eligible spouses by late summer.
GAO Recommendations Related to Economic Impact Payments
- Pandemic Unemployment Assistance (PUA) program. Generally authorizes up to 39 weeks of UI benefits to individuals not otherwise eligible for UI benefits, such as self-employed and certain gig economy workers, who are unable to work as a result of COVID-19, available through December 2020.
- Federal Pandemic Unemployment Compensation (FPUC) program. Generally authorized an additional $600 benefit that augmented weekly UI benefits available under the regular UI program, as well as CARES Act UI programs, through July 2020.
- Pandemic Emergency Unemployment Compensation (PEUC) program. Authorizes an additional 13 weeks of UI benefits to those who exhaust their regular UI benefits, available through December 2020.
aSome businesses with more than 500 employees were eligible for Paycheck Protection Program loans if they were considered small in their industries per the Small Business Administration’s size standards or if they were in the accommodation and food services industry and had not more than 500 employees per physical location.
Note: For purposes of this analysis, canceled loans are those in SBA’s loan-level data with a status of “fully canceled.”
- SBA’s interim final rules on loan forgiveness and a procedural notice issued on July 23, 2020, indicate that the lender is to review the borrower’s application for loan forgiveness and make the decision on forgiveness. However, the extent of lender review required is unclear. Prior to making the decision, lenders are expected to perform a “good-faith review” in a reasonable amount of time of the borrower’s calculations and supporting documents and confirm the borrower’s calculations concerning amounts eligible for loan forgiveness. The interim final rules and procedural notice do not clearly define the extent of review required but one rule provides an example. At the same time, the loan review procedures interim final rule and the procedural notice state that an accurate calculation of the loan forgiveness amount is the responsibility of the borrower and that lenders may rely on borrower representations. On August 4, 2020, SBA posted responses to frequently asked questions on loan forgiveness that answer technical questions, but do not address broader questions about lenders’ role. After SBA issued additional guidance in July and August 2020, representatives of two lender associations we interviewed still had questions or concerns about the lender’s role in the forgiveness process, including the level of review required and the extent to which lenders could rely on borrower certifications and calculations.
- In its July 23, 2020, procedural notice, SBA noted that it had contracted with a company to develop and make available a secure platform for lenders to submit loan forgiveness decisions, supporting documentation, and requests for forgiveness payments. SBA launched the platform on August 10, 2020. SBA officials told us they did not expect to receive a large number of loan forgiveness decisions from lenders until early August 2020 due to the timing of the CARES Act and SBA rules.
- According to SBA officials, as part of its oversight SBA will put all lender decisions granting full or partial loan forgiveness through the automated review tool provided by one of its contractors. SBA’s interim final rule on loan review procedures and the July 23, 2020, procedural notice indicate that SBA reserves the right to direct a lender to deny an application or to review the lender’s decision. As of August 14, 2020, SBA was still developing its processes for loan reviews, which include overseeing loan forgiveness.
Note: The COVID-19 relief laws appropriating the amounts described in this table are the Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020) and the CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020). Some appropriation amounts include an amount available for administration expenses or for the relevant inspectors general. An expenditure is the actual spending of money, or an outlay. Numbers are rounded to the nearest million or billion.
aSeveral provisions in the Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020), authorized an increase in Medicaid funds for states and territories. The largest increase to federal Medicaid spending is based on a formula change rather than a specific appropriated amount. The Congressional Budget Office estimated that federal expenditures from this change would be approximately $50 billion.
bThis amount represents all expenditures as of June 30 and July 31, 2020, from the Disaster Relief Fund for COVID-19. This amount includes expenditures associated with the major disaster declarations, but, according to Federal Emergency Management Agency (FEMA) officials, does not include expenditures related to the nationwide emergency or surge activity. FEMA officials also said that the agency has not obligated or expended any money appropriated to the Disaster Relief Fund by the CARES Act and, instead, has funded, and continues to fund, its obligations and expenditures related to COVID-19 relief operations from the balances of prior year appropriations to the Disaster Relief Fund. Some of the expenditures were for FEMA’s Public Assistance program, which provides emergency protective assistance to state, local, territorial, and tribal governments. Expenditures for the Public Assistance program as of June 30, 2020 and July 31, 2020 were $1 billion and $2 billion, respectively.
cThis amount is an approximation and includes funds for the Elementary and Secondary School Emergency Relief Fund; the Governor’s Emergency Education Relief Fund; Education Stabilization Fund discretionary grants; formula grants to the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa (which are referred to in the law as outlying areas); and programs operated or funded by the Bureau of Indian Education. It does not include the nearly $14 billion in aid for institutions of higher education through the Education Stabilization Fund.
dFunds are available to eligible sponsors of airports. Nearly all of these airports are under city, state, county, or public-authority ownership.
GAO Recommendation Related to Coronavirus Relief Fund Audit Requirements
The Director of the Office of Management and Budget, in consultation with the Department of the Treasury, should issue the addendum to the 2020 Compliance Supplement as soon as possible to provide the necessary audit guidance, as many single audit efforts are underway. (Recommendation 11)
GAO Recommendation Related to Guidance for K-12 Schools
The Director of the Centers for Disease Control and Prevention should ensure that, as it makes updates to its federal guidance related to reassessing schools’ operating status, the guidance is cogent, clear, and internally consistent. (Recommendation 12)
|GAO Recommendation Related to Tracking Contract Activity|
- Pillar 1: Protecting U.S. Citizens and Maintaining U.S. Operations. State reported obligating supplemental funding to maintain consular operations, which faced a significant decline in visa and passport fees resulting from the pandemic. State planned to use supplemental funds to, among other things, increase secure communications bandwidth, accessibility, and support for those working remotely; expand cloud and email storage capacity; and support efforts by the Bureau of Medical Services to continue effectively and safely achieving State’s mission domestically and overseas by contracting for experts in areas such as infectious disease, mental health, and statistical analysis of health data. Efforts also included purchasing and distributing personal protective and testing equipment, targeted hiring, and adding capacity for medical evacuation travel and contract aviation to continue international operations in the face of reduced global commercial airline service.
- Pillar 2: Global Health Assistance. USAID reported obligating supplemental funding as of June 6, 2020, to provide global health assistance for at least 73 countries affected by and at risk of COVID-19; regional activities in the Caribbean, Pacific Islands, and Asia; and worldwide activities. This assistance included preventing and controlling infections in health facilities; conducting contact tracing; improving readiness to rapidly identify and treat cases; raising awareness in populations through risk communication; screening people at points of entry and exit; and purchasing commodities, including ventilators.
- Pillar 3: Humanitarian Assistance. USAID reported obligating supplemental International Disaster Assistance account funding as of June 6, 2020, for 11 countries, regional activities in the Pacific Islands, and worldwide activities. This funding focuses on mitigating widespread transmission of COVID-19, addressing public health consequences, and maintaining essential health services for crisis-affected populations, particularly displaced people. Assistance efforts have included support for health interventions; water, sanitation, and hygiene services; protection services, such as psychosocial support; and risk communication activities. This funding is also supporting response logistics and the response to the secondary impacts of COVID-19, including the enormous emergency food needs, according to USAID officials. In addition, State reported that it obligated supplemental Migration and Refugee Assistance account funding as of July 10, 2020, for 56 countries and regional and worldwide activities. These obligations support assistance efforts similar to those USAID has supported with International Disaster Assistance funds, but focus on the needs of specific populations of concern, including refugees, victims of conflict, internally displaced persons, stateless persons, and vulnerable migrants.
- Pillar 4: Economic and Development Assistance. USAID reported that State and USAID obligated supplemental funding under Pillar 4 as of June 6, 2020, for nine countries, as well as regional and worldwide activities. Examples of activities supported include providing technical assistance and access to credit for micro, small, and medium-sized enterprises; strengthening civil society; protecting and assisting vulnerable people; monitoring legal protection for journalists; and providing direct cash relief to households.
- Host government COVID-19-related restrictions. Visa restrictions, curfews, quarantines, and movement restrictions have impeded the ability of humanitarian workers to operate in some countries. For example, according to USAID officials, Nigeria’s visa restrictions have created difficulty for relief workers to travel there, and Ethiopia has limited movements at land borders, except for the flow of cargo and essential goods. In Iraq, travel restrictions posed challenges delivering medical supplies to program sites.
- Lack of key commodities. Due to concerns around possibly diverting scarce PPE, such as surgical masks and gloves, from the domestic response to the COVID-19 pandemic in the United States, USAID officials told us that they instructed all implementing partners in early March 2020 to temporarily pause any purchases of PPE products using USAID funds. According to USAID, this pause posed challenges for implementing partners in both protecting their own staff as well as ensuring the continuity of USAID’s emergency health assistance. On June 9, 2020, USAID ended the pause by issuing interim policy guidance to allow implementing partners to procure restricted PPE materials without prior authorization in the following two situations: (1) for their staff from any source, and (2) for the protection of beneficiaries of USAID programs from PPE manufactured locally or in the same region where USAID is providing assistance as long as the PPE is not, and could not reasonably be, intended for the U.S. market. Some countries may continue to face shortages of PPE, according to USAID officials. For example, USAID officials told us in early July that USAID-funded partners working in Sudan had reported that the shortage of PPE across the health sector has made it difficult for relief workers to respond safely to COVID-19.
- Lack of qualified partners or staff. For some countries with limited USAID presence, there are very few qualified partners to implement USAID-funded assistance. USAID partners have also faced challenges recruiting and training local staff to implement response activities. Additionally, USAID cited an example in which a program’s operations in Nigeria were suspended when a quarantine was imposed following the death of a relief worker who contracted COVID-19.
- Additional challenges for humanitarian assistance. According to State officials, partner organizations face several challenges to providing COVID-19-related assistance to vulnerable populations that are already in the midst of a humanitarian crisis. These challenges include limited in-person implementation and monitoring; xenophobic violence directed at aid workers, refugees, migrants, and other foreigners believed to be importing the virus; closed borders; and delays in health care delivery, among many other concerns.
Evolving Lessons Learned from the Ongoing COVID-19 Response Highlight Areas for Timely and Concerted Actions
GAO Recommendation Related to Nursing Home Data
The Secretary of Health and Human Services, in consultation with the Centers for Medicare & Medicaid Services and Centers for Disease Control and Prevention, should develop a strategy to capture more complete data on confirmed COVID-19 cases and deaths in nursing homes retroactively back to January 1, 2020, and to clarify the extent to which nursing homes have reported data before May 8, 2020. To the extent feasible, this strategy to capture more complete data should incorporate information nursing homes previously reported to the Centers for Disease Control and Prevention or to state or local public health offices. (Recommendation 15)
- Two states offer clear and accurate instructions that providers should bill the state Medicaid program first and that HRSA is the payer of last resort.
- One state provides opposite, and inaccurate guidance, directing providers to bill HRSA until HRSA’s funds are exhausted, at which point providers can bill Medicaid. The state’s website also provides a link for providers to access the HRSA payment website.
- Some other state websites we reviewed had more limited information on Medicaid’s optional coverage or HRSA’s provider payment program and how providers should bill the programs.
GAO Recommendation Related to Department of Health and Human Services Cyber Threats
Based on the imminent cybersecurity threats, the Secretary of Health and Human Services should expedite implementation of our prior recommendations regarding cybersecurity weaknesses at its component agencies. (Recommendation 16)
- DOD partially concurred with our recommendation to establish a time frame for documenting and sharing a national plan for distributing and administering COVID-19 vaccine. In commenting on the draft report, DOD clarified that it is supporting HHS in developing plans for nationwide distribution and administration of vaccine to counter COVID-19. We revised the recommendation to reflect DOD’s supporting role in developing these plans.
- DOD stated that it disagreed with the recommendation to revise the criteria in its 2019 NIA code memorandum of agreement. DOD indicated that revising the agreement to address the second and third part of the recommendation would limit the government's flexibilities. We maintain that adding some clarity and specificity to the criteria is important, as it would better ensure consistent application of the criteria over time, as well as enhance visibility for agencies, Congress, and the public regarding decisions to extend or close the NIA code. For example, establishing time frames for evaluating the need to extend a NIA code will help ensure interested parties have sufficient notice as to whether a code will be extended, thus allowing sufficient time to for these entities to provide input regarding the need to extend the code.Furthermore, we believe additional specificity could be added to the criteria without being unduly restrictive. For example, providing clarification in the memorandum of agreement as to what is considered “routine” could better ensure consistent application of criteria over time, increase transparency regarding when a code is close to closing, and yet still allow for professional judgment to be applied. Such clarification could perhaps be based on historical analysis of different types of similar events (e.g., hurricanes, public health emergencies, or contingency operations).
- Regarding the first part of the recommendation on obtaining input from other federal agencies, DOD noted that the memorandum of agreement already includes a description of the communication methods used with other federal agencies. However, as we note in our report, the agreement does not identify any processes or steps DHS and DOD could or should take to coordinate with the various agencies involved in emergency acquisitions to determine that they will consider requests from agencies for extensions based on the criteria in the agreement and their discretion. Given the stated intent of the NIA code in the agreement for federal agencies to identify contracts awarded in response to high visibility disasters, emergencies, and contingency operations with significant multi-agency federal procurement impact, proactively obtaining input from other agencies involved in the response is necessary to ensure the successful tracking of government-wide procurements for these high-visibility events.
- Finally, DOD stated that it and DHS are committed to annually reviewing the memorandum of agreement for necessary updates, including communication with other federal agencies over NIA codes. We encourage DOD, DHS, and GSA—the third signatory to the agreement responsible for managing the code in the Federal Procurement Data System-Next Generation—to use this annual review to implement this recommendation so as to better ensure consistent application of the criteria and increased transparency regarding the process for extending and closing NIA codes.
- In the draft product we provided DOD and DHS for comment, we included an additional recommendation for DHS and DOD to extend the NIA code beyond September 30, 2020. In its comments, DHS and DOD concurred with this recommendation and extended the NIA code until March 31, 2021, while the report was with the agencies for comment. Because DOD and DHS’s actions addressed our draft recommendation, we have withdrawn that recommendation from our final report.
- HHS did not agree with the three recommendations in the draft report related to the medical supply chain. First, HHS did not concur with the recommendation related to developing roles and responsibilities for the supply management functions that are transitioning to HHS. In response to our second recommendation, HHS commented that it is in the process of producing documented responsibilities. However, HHS did not address any of the issues in our report regarding the transition of responsibilities. As such, we stand behind the evidence presented and this recommendation. For our other two recommendations regarding the medical supply chain, HHS commented that our report prioritizes “anonymous anecdotes” to develop our recommendations and objected that we did not disclose to HHS the names and titles of the officials with whom we spoke. Our findings are based on evidence from numerous sources and are an evaluation of the sum of the evidence to identify themes and challenges that reoccurred frequently. These include August 2020 federal reports on medical supply availability, interviews with federal officials, and interviews with senior state officials in multiple departments who were in appropriate positions to discuss state actions, supply availability, and the federal response. Consistent with generally accepted government auditing standards, we sought out officials with direct knowledge of the issues we studied and further confirmed that knowledge during the course of the interview. Specifically, we interviewed senior officials from departments of health and emergency preparedness from eight select states. Consistent with GAO practices, we selected the states we interviewed using robust methodological standards. We described the selection criteria and disclosed the eight selected states in the report’s objectives, scope, and methodology section, as well as the two states that provided additional evidence during a call with a national association (a total of 10 states for the findings about state, territorial, and tribal supply issues).As noted in the report, generally we reported those issues that arose in a majority of state interviews. These same concerns also arose in a number of the interviews we conducted with national associations and with FEMA regional offices. These were not isolated, singular opinions expressed by state officials removed from the response. HHS also stated that without knowing the title or name of the individuals who described challenges with the federal distribution of medical supplies, it cannot take corrective actions. We disagree. Our recommendations are not that HHS should individually follow up with each of the officials we interviewed to adjudicate individual issues that have already occurred. The intent of the recommendations is that HHS and FEMA, as leads for this pandemic response, seek to better understand the problems we identified and devise solutions to help ensure the federal government can mitigate remaining medical supply gaps, and assist states, tribes, and territories in serving their citizens effectively.In addition, in response to a draft of the second recommendation, which directed the department to further develop and communicate a comprehensive supply management plan in coordination with FEMA, HHS emphasized the work that had been done to manage the medical supply chain and increase supply availability. We agree that HHS, FEMA, and their federal partners have taken numerous actions to respond to the unprecedented need for medical supplies and our report describes many of these efforts. However, we found that certain supply constraints continue without plans outlining the specific actions the federal government will take to address them. We also report on differing perspectives about the extent of the medical supply gaps that remain. Further, HHS stated that our draft recommendation suggested that the federal government should federalize all supply procurement and distribution. This is not the intent of the recommendation. Rather, we believe that HHS, in coordination with FEMA, should further develop and communicate to stakeholders any plans outlining specific actions the federal government will take to address remaining medical supply gaps. This is an important step to help ensure federal response efforts align with demand. Further, it would provide needed clarity to federal partners and nonfederal entities on priority needs and ongoing efforts to address those needs. We maintain our recommendation is warranted and have modified it to clarify our intent.For our recommendations that HHS and FEMA work with relevant federal, state, territorial, and tribal stakeholders to devise interim solutions to the supply challenges they face for the remainder of the response—visibility, tracking, and budgeting—HHS also described efforts that it already undertakes, with the implication that these are sufficient to address any challenges described in the narrative supporting this recommendation. We commend HHS for these actions, and at the same time, note that nonfederal officials continued to report the kind of challenges we described irrespective of these efforts. We note that perhaps these venues are one good starting point to conduct the kind of outreach and listening sessions necessary to begin to help states, tribes, and territories address the challenges they are still facing, particularly as conditions may worsen as we move into fall and winter months.
- While HHS officials neither agreed nor disagreed with our recommendation to establish a time frame for documenting and sharing a national plan for distributing and administering COVID-19 vaccine, in its comments, HHS noted that several factors complicate the publication of a firm vaccine distribution timeline and affect the administration and distribution of a vaccine. Such factors include the number of doses that may need to be administered and vaccine storage requirements; these factors depend on which vaccine candidate or candidates are identified and on clinical trial results. HHS further commented that it will soon send a report to Congress outlining a distribution plan that takes into consideration these issues as well as the frameworks HHS is developing with input from CDC’s Advisory Committee on Immunization Practices and the National Academies of Sciences, Engineering, and Medicine.We agree these are critical steps, along with the planning documents CDC sent to state and local jurisdictions, and we are encouraged that HHS intends to outline a distribution plan soon. Yet we continue to believe the Secretary of Health and Human Services, with support from the Secretary of Defense, should establish a specific time frame for documenting and sharing its national plan. This will allow all relevant stakeholders to be best positioned to also begin planning for administering a vaccine, and will help ensure a well-coordinated response involving any licensed or authorized vaccine.
- HHS partially agreed with our recommendation that HHS, in consultation with CMS and CDC, develop a strategy to capture more complete data on confirmed COVID-19 cases and deaths in nursing homes back to January 1, 2020, and to clarify the extent to which nursing homes have reported data before May 8, 2020. Specifically, HHS agreed that collecting more complete data would be useful for determining the total number of nursing homes affected, the extent of morbidity and mortality, and changes in incidence over time. Further, HHS noted that having complete data would be useful in the review of policies and practices put in place during the pandemic. However, HHS said, because retroactively collecting the data “may be overly burdensome on health care providers,” it does not believe devoting substantial agency or health care provider resources during the pandemic “would be prudent.” We maintain the importance of developing a strategy to collect data from this critical time period of early COVID-19 spread in nursing homes and maintain that the agency could begin by incorporating data previously reported to CDC or to state or local public health offices, which would ease the burden on nursing homes.
- SBA stated it is not accurate to suggest that SBA is not responding to our June 2020 recommendation that SBA develop and implement plans to identify and respond to risks in PPP to ensure program integrity, achieve program effectiveness, and address potential fraud, including in loans of $2 million or less. In particular, SBA noted that it has briefed us on its efforts in multiple interviews and has committed to continuing to update us as the plans are finalized. In the report, we acknowledge that SBA has begun developing its oversight plans. For example, we noted that according to SBA officials, SBA is currently working with Treasury and contractors to finalize plans for loan reviews and loan forgiveness reviews. However, we cannot consider the recommendation implemented until SBA provides documentation outlining the review procedures and showing that reviews have been completed.
- SBA also said that our statement that there are questions about the completeness and accuracy of the PPP data on jobs retained was inconsistent with our statement in the scope and methodology that we determined that the PPP data we used were sufficiently reliable. We assessed the reliability of each data variable we used individually. In the scope and methodology, we stated that we found the data sufficiently reliable to describe the geographic distribution of PPP funds, changes in PPP loan size over time, PPP loans by business size and type, and the extent of canceled loans. We did not report data on jobs retained because borrowers were not asked to include this information on their loan applications, none of the guidance on SBA’s website includes instructions to help lenders calculate jobs retained, and these data were either not reported or indicated zero jobs retained for 18 percent of loans.
The Honorable Richard C. Shelby
The Honorable Patrick J. Leahy
Committee on Appropriations
United States Senate
The Honorable Lamar Alexander
The Honorable Patty Murray
Committee on Health, Education, Labor, and Pensions
United States Senate
The Honorable Ron Johnson
The Honorable Gary C. Peters
Committee on Homeland Security and Governmental Affairs
United States Senate
The Honorable Nita M. Lowey
The Honorable Kay Granger
Committee on Appropriations
House of Representatives
The Honorable Frank Pallone, Jr.
The Honorable Greg Walden
Committee on Energy and Commerce
House of Representatives
The Honorable Bennie Thompson
The Honorable Mike D. Rogers
Committee on Homeland Security
House of Representatives
The Honorable Carolyn B. Maloney
The Honorable James R. Comer
Committee on Oversight and Reform
House of Representatives
IN THIS SECTION
- Appendix I: Report Enclosures
- Relief for Health Care Providers
- Nursing Homes
- Medical Supply Chain
- COVID-19 Testing Data
- Vaccines and Therapeutics
- Medicaid Spending
- Veterans Health Care
- Military Health
- Defense Support of Civil Authorities
- HHS COVID-19 Funding
- Health Disparities
- Child Nutrition
- Employer Tax Relief
- Unemployment Insurance Programs
- Head Start
- Worker Safety and Health
- 2020 Tax Filing Season
- Paycheck Protection Program
- Eviction Moratoriums
- Economic Injury Disaster Loan Program
- Federal Reserve Emergency Lending Programs
- Financial Assistance to Aviation and Other Eligible Businesses
- Agriculture Spending
- Federal Food Safety Inspections
- K-12 Education
- Transit Industry
- Coronavirus Relief Fund
- Airport Grants
- International Trade
- Repatriation of U.S. Citizens
- Appendix II: Scope and Methodology
- Appendix III: List of Ongoing GAO Work Related to COVID-19, as of September 9, 2020
- Appendix IV: Status of GAO’s June 2020 Recommendations
- Appendix V: Comments from Department of Defense
- Appendix VI: Comments from Department of Education
- Appendix VII: Comments from Department of Health and Human Services
- Appendix VIII: Comments from Department of Homeland Security
- Appendix IX: Comments from Department of Housing and Urban Development
- Appendix X: Comments from Department of the Treasury
- Appendix XI: Comments from Department of Veterans Affairs
- Appendix XII: Comments from Internal Revenue Service
- Appendix XIII: Comments from Office of the United States Trade Representative
- Appendix XIV: Comments from United States Agency for International Development
aHHS allocated about $50 billion from the Provider Relief Fund for general disbursement to facilities and providers that participate in Medicare fee-for-service based proportionally on eligible providers’ share of 2019 net patient revenue from the Medicare fee-for-service program. For both the $30 billion and $20 billion disbursements, providers must have had active Medicare billing privileges and have treated patients after January 31, 2020, among other terms and conditions.
bHHS initially allocated $10 billion to rural hospitals, including rural acute care general hospitals and Critical Access Hospitals, Rural Health Clinics, and Community Health Centers located in rural areas. On July 10, 2020, HHS announced an additional allocation of about $1 billion for specialty rural hospitals, urban hospitals with certain rural Medicare designations, and hospitals in small metropolitan areas.
cHHS initially allocated $12 billion for hospitals with high COVID-19 admissions, with $2 billion of these payments going to hospitals based on their Medicare Disproportionate Share funding. On July 17, 2020, HHS announced an additional allocation of $10 billion to hospitals based on the number of COVID-19 inpatient admissions.
dHHS told us that it allocated $10 billion for providers who submit claims for reimbursement for care or treatment related to positive diagnoses of COVID-19 provided to individuals who do not have any health care coverage at the time the services were provided. The Office of Management and Budget (OMB) told us on September 3, 2020, that the amount of this allocation is not final.
eHHS allocated about $5 billion to eligible skilled nursing facilities (SNF). Eligible SNFs for this disbursement are those that are certified with six or more certified beds.
fHHS allocated $500 million for the Indian Health Service, including tribal hospitals, clinics, and urban health centers.
gHHS initially allocated $10 billion for safety net hospitals that serve a disproportionate number of Medicaid patients or provide large amounts of uncompensated care, and operate on thin margins. On July 10, 2020, HHS allocated an additional $3 billion for certain safety net hospitals, expanding the criteria for payment qualifications to meet a revised profitability threshold.
hHHS allocated $15 billion for providers who did not receive funds from the $50 billion general relief disbursement, billed the Medicaid/CHIP programs or Medicaid managed care plans for health care-related services from January 1, 2018, to December 31, 2019, and provided patient care after January 31, 2020.
iHHS told us that it allocated $3 billion for dental providers. OMB told us on September 3, 2020, that the amount of this allocation is not final.
- The Advisory Group was tasked with maximizing the nationwide availability of PPE, ventilators, and other material. In response, Advisory Group officials said they focused on four key supply activities: helping preserve existing supplies; accelerating the delivery of supplies; expanding the availability of supplies; and gathering data to help allocate scarce supplies.
- The JATF was established to support the acquisition needs of federal agencies in their public health response activities and provide access to DOD’s acquisition capabilities, tools, and skill sets. For example, the JATF provided acquisition specialists that conducted market research for specific PPE, such as N95 respirators, and provided recommendations to HHS on acquisition strategies.
Note: Planned 90-day inventory of personal protective equipment (PPE) are from HHS officials. Assistant Secretary for Preparedness and Response officials told us they based the PPE inventory targets on peak usage rates of PPE since the start of the COVID-19 response.
⬤ State officials noted an existing stockpile that was at target for planned inventory amounts for most personal protective equipment (PPE).
◒ State officials noted an existing stockpile that still needed several items of PPE to get to the target planned inventory amounts.
⭘ State officials are planning a stockpile but are facing challenges with implementation such as acquiring PPE, finding space, or providing PPE to communities.
- Seven of eight state officials we interviewed in July and August 2020 noted that the situation related to PPE had improved since earlier in the response, but they noted continuing challenges in obtaining some types of PPE. For example, officials from one of the eight states we interviewed told us they are unable to fulfill local entities’ requests for N95 respirators and nitrile gloves, but have sufficient supply of other items, such as face shields. Another state noted that they have a good inventory of most PPE but continue to wait on commercial orders for gloves, which they expect to start receiving soon. Additionally, two states’ officials expressed concern about the uncertain path of the virus and the impact of a fall surge on supply availability.
- Although FEMA coordinated the delivery to nursing homes of a 14-day supply of gloves, surgical masks, gowns, and eye protection from May through July 2020, some nursing homes reported low inventories of supplies in July 2020. Specifically, according to data nursing homes self-reported to the Centers for Disease Control and Prevention (CDC), as of July 26, 2020, about 22 percent of nursing homes did not have a one-week supply of at least one or more of the following: N95 respirators, surgical masks, gloves, eye protection, or gowns.
- The American Nurses Association surveyed both members and non-members in late July and early August about their PPE experiences over the prior two weeks. Their results found that 88 percent of the over 14,000 responding nurses reported being required or encouraged to reuse single-use N95 respirators. For those who reported reusing N95 respirators, 62 percent expressed concerns about their safety as a result.
- Additionally, the biggest obstacle to physicians reopening their practices is “ongoing shortages of PPE, especially N95 respirators and gowns,” according to a June 30, 2020, American Medical Association letter to the Vice President.
- Adopting standard definitions of testing data. Laboratory stakeholders sought to clarify with HHS the standard definitions for testing data to help ensure laboratories collected and reported consistent testing data. CDC has collaborated with stakeholders to publish standard definitions for newly requested information, such as codes that identify the specific COVID-19 tests that have been authorized. On July 14, 2020, CDC and OASH acknowledged that additional guidance to clarify standard definitions for required testing data will be needed and provided evidence of CDC’s and the Food and Drug Administration’s (FDA) work with stakeholders to develop and implement this guidance. On July 31, 2020 – one day before the August 1, 2020, deadline for laboratories to begin reporting testing data – HHS published implementation specifications with standard definitions for all the information that should be included in testing data. 
- Modifying information systems to collect and report testing data as required. According to one laboratory association we spoke with, some laboratories have made changes to their information system's infrastructure to meet the requirement to provide testing data. However, others struggled to meet the requirement’s August 1, 2020, deadline. Laboratories may exchange testing data with numerous health care providers and state public health agencies, which can require multiple updates to multiple data systems to meet the new requirements. For example, a laboratory association we contacted explained that one laboratory performs tests for more than 200 separate clinics, and each clinic orders tests through a unique electronic health records system. Some laboratories have developed the technical capability to report testing data electronically, including the 50 state public health laboratories, according to a laboratory association we spoke with. However, laboratory associations told us that some laboratories are new to reporting public health data and may make additional changes to information systems after the August 1, 2020, deadline to fully comply with reporting requirements, according to laboratory associations.
- Obtaining required testing data from health care providers who order tests. In addition to laboratories, health care providers play key roles in collecting and reporting complete and consistent testing data. Health care providers collect testing samples from patients and collect data that accompany the testing orders they send to laboratories, such as patients’ race, ethnicity, age, and zip code. However, if health care providers do not obtain this information, the information will remain missing from testing data unless it can be obtained through additional communication with these providers or from other sources, such as state or regional health information exchanges. Laboratory associations we contacted emphasized the importance of educating health care providers to collect required data from patients when collecting testing samples in order to comply with reporting requirements. However, representatives from provider groups told us that updating electronic health records to capture the newly requested data when ordering COVID-19 tests will be challenging because these data systems require significant effort to update. CDC has conducted outreach to provider organizations such as the American Medical Association to offer education and assistance on collecting testing data, and OASH confirmed on July 14, 2020, that ongoing support for health care providers will be needed to help ensure complete and consistent collection and reporting of testing data.
- Operation Warp Speed announced awards totaling about $12.6 billion to accelerate the development, manufacturing, and distribution of COVID-19 vaccines and therapeutics, as of September 1, 2020. For example, in June 2020, it announced adding about $628 million to an existing contract to secure domestic manufacturing capacity for potential COVID-19 vaccines and therapeutics, including capabilities to fill vaccine vials and finish packaging vaccine.
- BARDA awarded about $10.8 billion for seven vaccine candidates and about $1 billion for nine awards for therapeutic development, as of August 18, 2020. According to HHS, six of the seven vaccine candidates are part of Operation Warp Speed, and as such, part of these award funds are included in the Operation Warp Speed amounts above.
- CDC’s Advisory Committee on Immunization Practices established a COVID-19 Vaccine Work Group to collect, analyze, and prepare information related to COVID-19 vaccines for presentation, discussion, deliberation, and vote by the advisory committee. CDC provides technical and administrative support and contributes to the evidence that informs the advisory committee’s recommendations, including for use of future COVID-19 vaccines.
- FDA issued guidance for industry on the development and licensure of vaccines to prevent COVID-19 in June 2020. According to the agency, FDA would expect that a COVID-19 vaccine would be at least 50 percent more effective than placebo in preventing COVID-19 or SARS-CoV-2 infection among the clinical trial participants. FDA’s guidance also encourages the enrollment of populations most affected by COVID-19 in clinical trials, specifically racial and ethnic minorities.Under its Coronavirus Treatment Acceleration Program, FDA reported it had reviewed more than 270 trials of potential therapies for COVID-19 and that another 570 or more development programs for therapeutic agents were in the planning stages as of July 31, 2020. FDA also issued guidance for industry on developing drugs and biological products for the treatment or prevention of COVID-19, as well as on the administration and study of one investigational treatment being explored for COVID-19—convalescent plasma collected from individuals who have recovered from COVID-19.
- NIH’s National Institute of Allergy and Infectious Diseases established a new clinical trials network that aims to enroll thousands of volunteers in large-scale clinical trials to test a variety of investigational vaccines and monoclonal antibodies intended to protect people from COVID-19.  The NIH Director testified that each of the vaccine trials will aim to enroll 30,000 participants, half of whom will get the vaccine, half of whom will get a placebo.  According to NIH, the first phase 3 clinical trial that the clinical trial network was expected to conduct involves testing the investigational vaccine developed by scientists from NIH’s National Institute of Allergy and Infectious Diseases and their collaborators at the biotechnology company, Moderna, Inc.  According to NIH, this phase 3 trial began on July 27, 2020. In addition, NIH, along with CDC, requested a committee of experts develop a framework to assist policymakers in planning for allocation of COVID-19 vaccine. 
- DOD is actively participating in Operation Warp Speed and collaborating with HHS to make awards. DOD is also conducting research on candidates for vaccines and therapeutics. For example, DOD is working to adapt DNA technology to rapidly manufacture and deliver a vaccine for use by DOD personnel. According to DOD, the new DNA vaccine approach offers vaccine stability and ease of large-scale production. In addition, DOD is supporting a study on the investigational drug remdesivir.
- VA is partnering with Operation Warp Speed and others as part of nationally coordinated efforts for new vaccines and therapies. According to VA, those efforts were in the early stages and officials hoped to start the first clinical trial in late July.
- CMS provided guidance to states regarding when Medicaid should be billed first for COVID-19 testing. States choosing to use the optional benefit for testing the uninsured have communicated with providers regarding billing. Our review of the 16 state websites, however, found some examples of inconsistent information and in one case inaccurate communication to providers. For more information, refer to the Medicaid COVID-19 testing for uninsured individuals section of the body of this report.
- HRSA requires providers submitting claims to attest that they have confirmed individuals are uninsured, and HRSA’s program administrator implemented a prospective payment control on June 1, 2020 to check for insurance coverage for individuals on COVID-19 testing claims submitted to HRSA for payment. Further, HRSA officials reported that its program administrator is developing additional payment controls. On September 9, 2020, HRSA reported that retrospective payment controls that will recoup any identified improper payments began on August 31, 2020. HRSA expects that additional prospective payment controls to help identify and deny claims for those with coverage under Medicaid’s new COVID-19 testing benefit will begin by the end of September 2020.
Note: Federal Medicaid payments were available for the second and third quarters of fiscal year 2020—January 1, 2020, through June 30, 2020—and do not include expenses for program administration.
aTwenty-one states and one territory reported uncertified third quarter expenditures. Certified state expenditures have been reviewed by states and are certified as being Medicaid allowable expenditures. Both certified and uncertified state expenditures are preliminary, as they are subject to further review and are likely to be updated as states continue to report their expenditures and receive federal matching funds. States can report payments and adjustments to payments up to 2 years after a quarter ends.
bNine states and one territory had not yet reported any third quarter expenditures as of July 31, 2020.
cUtah was the only state that reported expenditures for COVID-19 testing for the uninsured, and total reported expenditures were $51.
dTotals may not sum exactly due to rounding.
- 44,305 cumulative veteran cases of COVID-19, including 3,013 active cases, 38,684 convalescent cases, and 2,608 deaths; and
- 1,495 self-reported employee cases of COVID-19, 49 employee deaths, and 1,757 staff that were unable to work due to COVID-19.
- accelerated onboarding processes, reducing the time it takes to hire new staff from 94 days before the COVID-19 pandemic to an average of 10 to 12 days during the COVID-19 hiring surge, with some hires taking only 3 days. VHA has done this by using temporary and expedited credentialing processes, which can be completed faster than the standard credentialing process (1 day for temporary credentialing and 3 days for expedited credentialing, instead of 30 days). VHA told us full credentialing is still required subsequently to the temporary credentialing process and any provider with a history of licensure actions or significant malpractice history is not eligible for it. The expedited credentialing and privileging process waives the required contacts and verifications, which are completed at a later date. Given our past findings about the timeliness and documentation of VHA’s reviews of provider quality, it is critical that VHA complete the full credentialing and privileging processes in a timely manner.
- restructured its onboarding processes for new employees, allowing them to begin work more quickly. For example, VHA told us they implemented a VHA-wide mandatory training moratorium to defer non-COVID related training by 120 days for VHA clinicians and staff.
- Tennessee National Guard members assisted with COVID-19 testing of residents in long-term care facilities and correctional facilities, as well as state employees.
- Georgia National Guard members conducted infection control in 2,311 facilities, including nursing homes, and trained non-DOD personnel in infection control.
- National Guard members in Georgia, Kansas, North Carolina, Ohio, and Washington, among others, supported food distribution efforts. For example, Washington Guard members delivered 1.7 million meals and 23.8 million pounds of food.
- Missouri National Guard members processed and transported decedents.
aAccording to officials, the Army National Guard plans to identify an additional $114 million and the Air National Guard plans to identify an additional $131 million from the personnel accounts to return for reprogramming in forthcoming updates to their spend plans.
Note: HHS reported that of its total COVID-19 supplemental appropriations, the agency transferred $289 million to the Department of Homeland Security, and $300 million in appropriations are not available until future actions by HHS.
Note: The COVID-19 relief laws included provisions for HHS to transfer appropriated funds to various HHS agencies. HHS also reported that of its total COVID-19 appropriation, the agency transferred $289 million to the Department of Homeland Security, and $300 million in appropriations are not available until future actions by HHS.
aThese amounts do not reflect Medicaid and Medicare expenditures. As of July 31 2020, COVID-19 related federal Medicaid expenditures totaled approximately $13 billion, or 7 percent, of total spending on Medicaid services for this time period. In addition, the Congressional Budget Office estimated that some provisions of the CARES Act will increase Medicare payments to providers by $8 billion in 2020 and 2021.
bThe Public Health and Social Services Emergency Fund (PHSSEF) is an account though which funding is provided to certain HHS offices, such as the Office of the Assistant Secretary for Preparedness and Response. Amounts have been appropriated to this fund for the COVID-19 response to support certain HHS agencies and response activities. PHSSEF appropriations transferred to other HHS agencies or key funds not specifically listed are included under “Other PHSSEF.” For example, the Health Resources and Services Administration received $975 million in transfers from the PHSSEF, and this is represented in the table in “Other PHSSEF.”
cThe italicized amounts are subtotals of the PHSSEF and are not added in the total since they are included in the PHSSEF amount. Italicized amounts listed under the PHSSEF appropriations column are HHS allocations based on a combination of appropriations made in the relief laws, and approved allotment decisions made by HHS in coordination with OMB. The Provider Relief Fund reimburses eligible health care providers for health care related expenses or lost revenues that are attributable to COVID-19. The CARES Act and Paycheck Protection Program and Health Care Enhancement Act appropriated $175 billion for provider relief. In addition, the Families First Coronavirus Response Act and the Paycheck Protection Program and Health Care Enhancement Act designated up to $2 billion to reimburse providers for COVID-19 testing for uninsured individuals. Provider Relief Fund expenditures may also be referred to as disbursements.
Note: HHS reported allocations, obligations, and expenditures for these activities based on the primary programmatic recipient organization of the funds, although some activities apply to multiple categories. For example, certain funds in the “support to state, local, territorial, and tribal organizations for preparedness” category were provided for testing but are not reflected in the “testing” category. According to HHS officials, the allocations reported for the key activities above are based on amounts appropriated for these activities in the relief laws and approved allotment decisions made by HHS in coordination with the Office of Management and Budget.
aHealth centers provide a comprehensive set of primary and preventative health care services to individuals regardless of their ability to pay. Approximately $17 million of this funding is for Health Center Program look-alikes, which are centers that do not receive Health Center Program funding but meet program requirements.
bThe Provider Relief Fund reimburses eligible health care providers for health care related expenses or lost revenues that are attributable to COVID-19. The CARES Act and Paycheck Protection Program and Health Care Enhancement Act appropriated $175 billion for provider relief. In addition, the Families First Coronavirus Response Act and the Paycheck Protection Program and Health Care Enhancement Act designated up to $2 billion to reimburse providers for COVID-19 testing for uninsured individuals. Provider Relief Fund expenditures may also be referred to as disbursements.
cAccording to HHS officials, other response activities includes Centers for Disease Control and Prevention wide activities and program support, healthcare preparedness and response activities, Biomedical Advanced Research and Development Authority diagnostics development, and various activities conducted by the National Institutes of Health.
- Race and ethnicity information was missing for more than half (52.6 percent) of cases with case report forms received by CDC, or 63.8 percent of total cases reported as of July 31, 2020.
- CDC’s hospitalization data are limited to select counties in 14 states, and race and ethnicity information are not complete in the reported data.
- Several states do not include race and ethnicity in their reporting of deaths to CDC through case reporting as of July 30, 2020, according to CDC. Race and ethnicity data were missing for 16.6 percent of deaths with case report forms received by CDC, or 35.4 percent of total deaths reported through case reporting, as of July 31, 2020.
- Cases. CDC race and ethnicity data on COVID-19 cases, while incomplete, demonstrate that racial and ethnic minority groups have been disproportionately affected. Among cases with known race and ethnicity reported to CDC as of July 31, 2020, 32 percent of cases were for persons who were Hispanic or Latino (compared to 18 percent of the U.S. population), 20 percent were non-Hispanic Black (compared to 13 percent of the U.S. population), and 1.3 percent were non-Hispanic American Indian/Alaska Native (compared to 0.7 percent of the U.S. population). Though race and ethnicity data were missing for 53 percent of cases, these findings suggest that persons in these groups experience a disproportionately high burden of COVID-19 cases. Additionally, a Centers for Medicare & Medicaid Services (CMS) preliminary analysis of Medicare fee-for-service claims data and Medicare Advantage encounter data for services from January 1 through June 20, 2020, received by July 17, 2020, found racial and ethnic disparities in COVID-19 case rates, with case rates highest for Black beneficiaries (1,658 cases per 100,000), Hispanic or Latino beneficiaries (1,230 cases per 100,000), and American Indian/Alaska Native beneficiaries (1,125 cases per 100,000) and lowest among White beneficiaries (712 cases per 100,000).
- Hospitalizations. CDC data indicate that racial and ethnic minority groups are disproportionately hospitalized with COVID-19 in select counties in 14 states included in CDC’s COVID-19-Associated Hospitalization Surveillance Network (COVID-NET).  According to CDC’s analysis of data from COVID-NET hospitalizations between March 1, 2020, and August 1, 2020, non-Hispanic American Indian/Alaska Native persons were hospitalized with COVID-19 at a rate 5.2 times that of non-Hispanic White persons, and non-Hispanic Black and Hispanic or Latino persons were hospitalized at a rate 4.7 times that of non-Hispanic White persons when adjusting for age (see figure). Additionally, CMS found racial and ethnic disparities in COVID-19 hospitalization rates among Medicare beneficiaries, with hospitalization rates highest for Black beneficiaries (670 hospitalizations per 100,000), American Indian/Alaska Native beneficiaries (505 hospitalizations per 100,000), and Hispanic or Latino beneficiaries (401 hospitalizations per 100,000) and lowest among White beneficiaries (175 hospitalizations per 100,000) as of June 20, 2020.
- Deaths. A CDC analysis of National Center for Health Statistics (NCHS) death certificate data indicated a disproportionate number of deaths among non-Hispanic Black persons, who represent approximately one in four COVID-19 deaths in the United States.  As of August 12, 2020, NCHS data show that non-Hispanic Black persons died of COVID-19 at a rate 2 times higher than non-Hispanic White persons (see figure).  Additional disparities may be observed within age groups. In particular, racial and ethnic minority populations comprise a larger proportion of COVID-19 deaths at younger ages (see figure). CDC also reported that as of August 12, 2020, non-Hispanic Black persons older than age 75 had the highest death rate (824.7 per 100,000), followed by Hispanic or Latino persons older than age 75 (656.0 per 100,000) and non-Hispanic American Indian/Alaskan Native persons older than age 75 (428.3 per 100,000). In addition, we found that non-Hispanic Black and Hispanic or Latino persons accounted for the largest proportion of COVID-19 deaths in younger age groups, such as age 35-44 and 45-54 (see figure).
- higher rates of employment in essential industries, such as service, health care, and agriculture;
- limited or no paid sick leave or ability to work from home;
- lower earnings, lower educational attainment, and higher rates of joblessness;
- higher rates of uninsurance and other barriers to accessing care, such as mistrust of the health care system, language barriers, and cost of missing work;
- higher population density and overcrowded, multigenerational, or multi-family homes;
- greater reliance on public transportation;
- overrepresentation in jails, prisons, homeless shelters, and detention centers;
- limited plumbing and access to clean water;
- higher rates of underlying health conditions, such as chronic lung disease, asthma, and obesity; and
- experiences of racism, stigma, and systemic inequities.
- Paid leave credits. Businesses and tax-exempt organizations with fewer than 500 employees, as well as self-employed individuals, are eligible for refundable FFCRA credits. The credits are equal to qualified leave wages, plus the employer share of Medicare taxes paid with respect to qualified wages and allocable health plan expenses, from April 1 through December 31, 2020. Credit recipients who receive PPP loans cannot count the wages paid for by the credit as payroll costs toward loan forgiveness. Payroll tax credits may be claimed on the employer’s employment tax return, typically Form 941, Employer’s Quarterly Federal Tax Return. To receive immediate relief, employers may reduce their semiweekly or monthly payroll tax deposits by the amount of their credit. If an anticipated credit amount remains after reducing deposits, the employer may receive an advance refund by filing Form 7200, Advance Payment of Employer Credits Due to COVID-19. Form 7200 must be submitted using electronic fax (e-fax).
- Employee Retention Credit. Under the CARES Act, employers of any size—including tax-exempt entities and self-employed individuals with employees—can receive the refundable Employee Retention Credit. The credit equals 50 percent of qualified wages (up to $10,000 per employee) paid from March 13 through December 31, 2020, including certain health care expenses. Eligible employers are those who experience, in calendar year 2020, either (1) full or partial suspension of operations due to government orders limiting activity in response to COVID-19 during any calendar quarter, or (2) a decline in gross receipts of more than 50 percent, compared with the same quarter in 2019.PPP recipients are not eligible for the Employee Retention Credit, unless they repaid their PPP loans by May 18, 2020. Wages for which FFCRA credits are allowed are not included in wages for the Employee Retention Credit, among other exclusions from wages. Employers can claim the credit on their employment tax returns and may reduce payroll tax deposits by the credit amounts, or file Form 7200 for advance refunds.
- Deferred payroll tax payments for employer share of Social Security. The CARES Act granted all employers the option to defer deposits and payments of the employer share of Social Security tax that they would otherwise be required to make during the period beginning March 27 through December 31, 2020. Self-employed individuals may defer half of their Social Security taxes due. Deferred deposits are to be reported on Form 941.
|As of May 31, 2020||As of July 31, 2020||Change since May|
|Form 7200s reviewedc||6,189||18,984||12,795|
|Refunds issued ($ millions)||54.2||435.48||381.28|
aMultiple forms may be included in each e-fax submission. This may include duplicate submissions and aggregate submissions from the same employer. Per credit information is not available until employers file Form 941 for the second quarter.
bThis number differs from our June report when IRS officials said that the number of e-fax submissions was 8,754. In August, IRS officials said that number included the total number of Form 7200s received. They corrected this to 7,931, which is the total number of e-fax submissions received.
c “Form 7200s reviewed” figures include Forms 7200 and other submissions that might not include a Form 7200, such as blank cover sheets, PPP loan applications, and Forms SS-4. This number differs from our June report when IRS officials said that the number of Form 7200 reviewed was 7,185. In August, IRS officials clarified that number included cases pending assignment to a reviewer and cases where the review of the Form 7200 is still in progress. They corrected this to 6,189 to omit all cases actively in review, and only include completed reviews.
- Pandemic Unemployment Assistance (PUA), available through December 2020, generally authorizes up to 39 weeks of UI benefits to individuals not otherwise eligible for UI benefits, such as the self-employed and certain gig economy workers, who are unable to work as a result of COVID-19; 
- Federal Pandemic Unemployment Compensation (FPUC) generally authorized an additional $600 benefit that augmented weekly UI benefits available under the regular UI program, as well as CARES Act UI programs, through July 2020;  and
- Pandemic Emergency Unemployment Compensation (PEUC), available through December 2020, authorizes an additional 13 weeks of UI benefits to those who exhaust their regular UI benefits.