Congressional Democrats unveiled their proposal for the next round of coronavirus stimulus funding in a $3 trillion 1,816-paged plan called the HEROES Act on Tuesday afternoon.
“This is a moment when many millions of our fellow Americans are in deep suffering,” said House Speaker Nancy Pelosi in a press conference shortly after the bill was released. “It is imperative that we address the needs of the American people with clarity on how we proceed that is why today House Democrats are introducing the Heroes Act.”
The bill rests on three pillars, Pelosi said: Making sure the economy is able to reopen safely, honoring heroes, and putting “much-needed” money into the pockets of Americans.
House and Senate Republicans along with the White House oppose the bill, claiming that it comes too soon after the CARES Act, a similar stimulus bill which was signed into law in March. On a call with Republican Senators this week, Senate leader Mitch McConnell indicated that he was wary of passing any new bills ahead of late May.
House Republican whip Steve Scalise responded to the Democratic bill in a tweet calling it a “partisan spending bill full of liberal wish list items that [Pelosi] wrote completely in secret.” He referred to the plan as a “non-starter.”
The plan would bolster state and local economies with $500 billion specifically for states, $375 billion for local governments, $20 billion for tribal communities that have been hard hit by COVID-19, and another $20 billion for territories like Puerto Rico and Guam. The bill also includes another $1,200 in direct aid to individual Americans and another $200 billion in hazard pay for essential workers. The $600 per week federal unemployment insurance would be extended to January 2021, and $175 billion would be given out in rent, mortgage, and utility relief.
It would also make extensive changes to assist testing and tracking policies related to COVID-19 and to aid Americans who have lost their jobs and health insurance in the midst of the pandemic through shifts in major public and private health programs such as Medicaid, Obamacare, and COBRA.
Some of the more noteworthy provisions are below.
Relief for the Postal Service
House Democrats granted the United States Postal Service $25 billion in funding to be used to replace “revenue foregone due to coronavirus” until September 2022. The only requirements for the funding are that the postal service prioritize the purchase of personal protective equipment and safety of postal workers.
The Postal Service experienced a 30% drop in mail this April due to COVID-19, said postmaster general Megan Brennan. She predicted that without Congressional intervention, USPS would experience a revenue loss of $13 billion by the end of their fiscal year on October 1st solely because of the pandemic. That’s on top of the $9 billion the USPS was already losing each year in good economic times. Without a cash infusion, postal advocates predicted that the service would not be able to function past the end of summer.
Previous bills had given the Postal Service the option to loan money from the Treasury Department under the Trump administration’s terms, but this would be a relief fund.
The United States Postal Service is the only mail carrier required to deliver to every address in the country at a reasonable rate and will be vital to increased vote-by-mail operations this November.
An expansion for SNAP
In their bill, Democrats would expand the maximum amount benefits available through the Supplemental Nutrition Assistance Program, sometimes referred to as food stamps, by 15%, which is about the same increase seen in 2009’s American Recovery and Reinvestment Act. They would bolster the program with an additional $10 billion to help cover the costs of increased demand.
The USDA announced that last month benefits from SNAP had increased by 40% due to the more than 20 million newly unemployed Americans. “These are unprecedented times for American families who are facing joblessness and hunger,” Agriculture secretary Sonny Perdue said in a statement.
Increasing SNAP benefits are thought to be one of the most effective ways to bring families out of poverty. In 2009, Congress increased minimum SNAP benefits by 14%, and research found that every dollar increase in SNAP generated about $1.74 in economic activity. A United States Department of Agriculture report found that an increase in SNAP benefits also correlated directly to a decrease in unemployment.
Election assistance and preparedness
A presidential and federal election in the midst of a global pandemic is not an easy or cheap event to prepare for, and states have expressed apprehension and how underfunded and underprepared their systems are.
While the bill does put some requirements in place for receiving funds—states must report on how they spent them within 30 days and allocate the money to local precincts—it does not require them to create vote-by-mail systems. Instead, the provision allows states to increase access to PPE for poll workers and to expand absentee ballots and vote-by-mail initiatives if they wish to.
Notably, the bill does also retroactively removes a 20% match requirement for states on previous election assistance funding. Various secretaries of state expressed hardship meeting those requirements because their own budgets had been decimated by COVID-19, and congressman Joe Neguse (D-CO) filed a bill to remove the requirement.
COVID-19 health care efforts
The House of Representatives’ sprawling new stimulus proposal covers a number of complex and intertwined public health and insurance reform goals. It spans the gamut from funding COVID-19 testing and tracking efforts to major (if short-term) changes to the way that health insurance works as tens of millions of Americans lose their jobs.
COVID-19 tracking and testing
The $3 trillion package allocates an addition $75 billion for coronavirus testing and helping locales trace the people who may have had close contact with those who have tested positive for an active infection. Testing—whether for active infections or for people who have developed antibodies after recovering from a COVID-19 case—are critical to reopening the economy, as multiple experts have told Fortune.
Depending on how that money is dispersed should the bill pass, it could be critical to scaling up antibody testing which can give us a greater grasp on who is vulnerable and who isn’t among the workforce.
Obamacare, Medicaid, and COBRA
The stimulus proposal would make significant changes to a host of insurance programs which include private insurers, publicly funded plans for low-income Americans, and those who have lost their jobs.
It would enhance the special enrollment period and subsidies under the individual insurance Affordable Care Act marketplaces for those who have lost their employer-sponsored insurance. That would be a significant change given the tens of millions of Americans losing jobs in an economic calamity we haven’t seen since the Great Depression.
The bill would also force the federal government to pay a higher share of money for Medicaid beneficiaries.
Medicaid is a program that largely serves the poor and disabled, and it’s a joint public program between the federal government and individual states. The House bill would “extend the amount and duration of the federal match rate for Medicaid from 6.2 percentage points to 14 percentage points from July 1, 2020 through June 30, 2021,” as the nonpartisan Kaiser Family Foundation’s (KFF) Robin Rudowitz explained on Twitter Tuesday. That means skittish health care providers feeling a cash crunch from an influx of newly unemployed Americans without adequate health insurance may be more willing to see patients who are struggling financially.
Finally, there’s COBRA, the private insurance option for people who have been laid off from their jobs. COBRA is infamous for being extremely expensive. Recipients remain on their existing employer-provided private plans for a limited period of time but may be charged far more in monthly premiums. Under the House bill, there would be a 100% COBRA subsidy for those who have lost their jobs for a period of time.
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