Insight

American Rescue Plan Act of 2021: Healthcare Related Provisions

The American Rescue Plan Act of 2021 expands healthcare coverage and provides pandemic funding

Larry Kocot

Larry Kocot

Principal, Advisory, KPMG LLP

+1 202-533-3674

Tracey McCutcheon

Tracey McCutcheon

Specialist Director, Advisory, KPMG US

+1 202-533-5380

Ross White

Ross White

Director, Advisory, KPMG US

+1 202-533-3691

The American Rescue Plan Act of 2021 (“Rescue Act”), a $1.9 trillion COVID-19 relief package, was signed into law by President Joe Biden on March 11th. The Rescue Act is the second largest economic rescue package in US history, behind only the $2.2 trillion CARES (Coronavirus Aid, Relief, and Economic Security) Act passed in March 2020 at the beginning of the pandemic. The Rescue Act extends unemployment assistance, directs stimulus payments to eligible Americans, expands the child tax credit, and provides funding to support states and local governments and schools in their response to the pandemic.

Notably for the healthcare industry, the Rescue Act represents the biggest healthcare coverage expansion since the Affordable Care Act, enlarging employment-based, individual and small group, and Medicaid coverage. The Rescue Act also provides funding for testing and contact tracing, research and development of vaccines and therapeutics, the public health workforce, and mental and behavioral health services; ensures coverage of COVID-19 vaccines and treatments in Medicaid and CHIP; and eliminates the cap on Medicaid drug rebates. This issue brief summarizes major healthcare provisions in the Rescue Act, provides a section-by-section summary of all healthcare-related policy changes, and summarizes key non-healthcare provisions.

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